lizzy: good morning, this is "bloomberg daybreak europe." i'm lizzy burden in london. asian equities at higher after a rocky start to the year for u.s. stocks. concerns about china's economy

push the 10-year yield below one point 6% for the first time. south korean investigators failed to arrest impeach president yoon suk yeol after being blocked by protesters and his security team. the fbi finds no evidence seeking the attack in new orleans and the explosion of a cybertruck in vegas on new year's day, despite similarities. lizzy: very good morning. happy friday. we are looking at futures pointing lower in europe, higher in the u.s., but we had another session of disappointment in the u.s. yesterday. tesla results weighing on u.s. stocks. flipping over to the cross assets picture, we have japan still on holiday, so we await

cash trade in treasuries. that shall start at the top of the hour but euro-dollar at a 1.02 handle. we saw dollar strength as u.s. initial jobs claims fell to an eight-month low in on the flipside euro weakness. we are still on parity watch as we await news about trump tariffs on europe, fears about another energy crisis, and political uncertainty in france and germany. meanwhile, gold steady pretty, brent trading at sunday five dollars a barrel and bitcoin $96,000, dipping for the first time in four days. we can check on asia markets as well. it has been a dismal start to the year in asia. historically bad start for china . now trading in a tight range on the csi 300, down 0.7%, the yen steady at 157 per dollar. let's get back to those attacks

in the u.s. investigators have found no evidence linking the two attacks in new orleans and las vegas. the fbi continuing to examine the two incidents that rattled americans as they rang in the new year. >> there is also an fbi investigation in las vegas. we are following up all potential leads and not ruling anything out, however, at this point, there is no definitive link between the attack here in new orleans and the one in las vegas. lizzy: let's get more with bloomberg's derek wallbank. america on tenterhooks for more details but what have we actually learned the last 24 hours since the attacks? >> that really is the case. there has been a lot of unease, uncertainty and disquiet about the fact that these two events could have happened. they did happen in close proximity time-wise over each

other. one in the heart of new orleans, very big tourist city, the other in las vegas which needs no introduction as a tourist mecca of its own. the fbi is saying no definitive links. they have not been able to establish that one was directly to do with the other, however, you noted there are similarities. both people suspected to be involved, in both cases, were members at one point of the u.s. army. although there is way more people who serve, who have no difficulties at all, you couldn't possibly suggest anything like that. i think investigators are trying to figure out what could have been going on that would have prompted these things. because right now, candidly, the fact that there has not been any

suggestion of what has put these two things so close together has a lot of people on edge. i do also think there's going to be, i would say, a significant security response in places that have a large amount of public gatherings. one of the biggest of those will be donald trump's inauguration in washington, d.c. coming up this month. that is going to be a very, very big security posture moment anyway. but you can and should expect that although security plans will be run over with an even finer tooth comb going forward. lizzy: we thank you for the update on those two attacks. now to south korea, where authorities failed to arrest impeache president yoon suk yeol due to resistance from his

security team and protesters. katia has been tracking the developments for us. what are the likely next steps, if and when yoon his arrested? >> we are finding that out by the minute right now. we had special investigators showing up at yoon's residence this morning. the latest in this ongoing turmoil. meeting that wall of protesters who were pro the former president as well as his security staff. they were forced to pull back just for safety purposes because when you have that sort of match up you want to avoid especially with civilians, any kind of issue. the question is what comes next? we know that this arrest warrant is valid until january 6, so still a few more days they could attempt to do this again.

the cio will be hosting a press conference later today. they are kind of going back to the drawing board. they are drawing back for now. earlier today that was just under 3000 police officers at the scene, as well as private investigation unit. they have to decide whether they want to do that again, or whether there is another way of approaching this. lizzy: i'm looking at the kospi and the won both up. our analysts expecting the arrest of have much market impact or is it already priced in? >> it hasn't really moved markets this morning. we were expecting going back to how we first got here exactly a month ago on december 3 when martial law was declared, and right after that, the weeks that follow death impeachment and the new president and his subsequent impeachment as well, we saw the won filing as well as the kospi gyrating the past few weeks.

but today things are not too bad. to your point, a lot of this is priced into the market, especially when it comes to the currency. you even had the past five days, the kospi sliding, and today, sort of up. the question is what happens next with yoon. there is an assumption that there will be a development that he will be either arrested, or there will be some sort of election process, it is a democracy after all. the bottom line is just wait and see. the next couple days will be crucial for that. lizzy: bloomberg's katia d mitrieva, we thank you for keeping across this drama globe by blow. and on the terminal with the excellent live blog which subscribers can find by going to tliv on the terminal. u.s. markets have been having a

rocky start to the new year. equities lower for a fifth day. more now on what is driving the sour sentiment with bloomberg's valerie tytel. welcome back, val. >> it was a very volatile start to the year for u.s. equity markets. the s&p 500 had a near 2% swing intraday in yesterday's trade. it tried to rally but ended the session lower and snaps now a five-day losing streak with a broad u.s. benchmark. another eye-catching move yesterday was the strength in the u.s. dollar. we started the year off with a bout of dollar strength and most of that versus the euro, the euro sinking below that 1.03 handle, and this is interesting because euro pessimism is very much a consensus position. we know in january sometimes consensus positions get squeezed. the euro-dollar continues to trade lower. we are at 1.0273.

another eye-catching thing is overnight in the asia session, the chinese picture somewhat moderated. we have the chinese stocks in hong kong positive. the csi 300 which saw a near 3% slide yesterday is still down a percent. and china bond yields are moving lower again. we have a weaker chinese economy, combined that with a weaker inflation outlook for china, and the hopes of further monetary stimulus all very supportive environment for bonds in asia, especially in china, that really continuing. lizzy: those pmi numbers yesterday really knocking chinese stocks to kick off the start of the year. meanwhile though, the u.s. banking system reserves that the fed are at their lowest since october 2020. >> a lot of attention on banking reserves recently. we have the federal reserve's qt program still ongoing. many think it will end at the beginning of 2025.

it is because banking reserves have dropped below $3 trillion. many analysts see that level as the comfort level of reserves in the banking system, so we might risk another repo funding squeeze if banking reserves dip further than this. something to watch out for as expectations of one the federal reserve might end their qt program ramp-up. lizzy: and coming up on the program, it was a stellar 2024 for south african bonds which outperformed other emerging market countries and generated a whopping return of 14%. we will take a closer look at rainbow nation's economy next. stay with us. this is bloomberg. ♪

lizzy: all comeback to

"bloomberg daybreak europe." it's just gone 6:13 in london. let's go to south africa where the second half of last year saw the country's bonds the best performers among 18 other emerging markets, generating a total return of 14%. but coming to power of a ruling coalition, the first item 30 years between the anc and the democratic alliance, boosted investment in south africa's currency, equities and bonds. we get more with editor-in-chief m.r.i. does -- emeritus who joined us now from new york. good morning, matt. no one saw the ram strength in 2024 coming, but nor was the rewriting of south african political history a given. since the strong dollar knocked it, will it last in 2025? >> the real test is the federal reserve, as you know, has kept a

very restrictive credit stance. as you mentioned earlier, just about every currency that is a major in the world. whether it is the yen or especially the euro has depreciated significantly against the dollar. particularly with the fed's credit policy. the fact that the rand of all currencies which essentially has been one of the worst depreciating assets of the 21st century is, if you will, keeping his halo at this point is surprising and bodes well for what this new government means. it essentially means business. you have had a history, unfortunately, of one-party rule pretty much going back since the end of the unity government with nelson mandela. now for the first time you have a coalition which came about in

june. that wasn't predicted at this point last year. and that coalition is pro-business. that's why not only is the rand relatively strong, one of the few currencies holding its own against the dollar but as you said, the bond market has been resilient and even the stock market outperformed the world benchmark and that is unprecedented for south africa. lizzy: is it safe to say now you have forex and debt markets showing confidence in the government that this is a self-reinforcing positive loop? >> here's the thing, whatever doubts persist related to unremitting crime, corruption, insufficient infrastructure, south africa's gross domestic product has been upgraded eight times since march to almost a

percent growth in the fourth quarter. that's the most optimistic average forecast of 10 economists who contribute their research to bloomberg. they now say gdp will expand 1.6% by the end of 2025 that's based on this expectation for slower inflation which arguably is the most definitive measure of investor confidence. that really has turned favorable with the anc losing its parliamentary majority. you can see that in the bets that are being made across all markets. and it's kind of a symbiotic relationship, because when you look at the cpi now, it's down to 2.9% as of november. that's almost half the level at the start of 2024. these are all very constructive indicators. the fact that they are happening

as we noted greeting the new year where we are now, is first of all, we have not seen anything like this before but second it is very encouraging. lizzy: what are the main risks now to the rand and bonds? >> abraham lincoln once said, i'm too familiar with disappointment to be very much chagrined. that is very much the story here is there have been so many false starts with south africa. but the fact that the markets are holding their own is an important inflection point. you can't say the election changed everything for investors at least and that is pretty strong stuff given what we are seeing right now across the world with debt, equity and currency. our around economist for bloomberg economics sees the

growth outlook accelerating to something like 2% in the months ahead to more than 3% over the next 10 years from less than 1% during the past decade. if that happens, the picture for south africa has changed dramatically. lizzy: what are the main challenges in terms of infrastructure? you mentioned crime and governance as we look ahead to 25. >> the fact that you have, for the first time in more than two decades, a coalition government that is focused entirely on getting things done. that's what i mean by pro-business. that is very different from what has prevailed with a one-party rule that the anc had pretty much since the beginning of mandela's unity government, 30 years ago.

yes, the risks are still there, but it seems like there is a willingness to accept a kind of government that south africa really has not had since the end of apartheid. lizzy: bloomberg's editor-in-chief emeritus matt winkler, wonderful to speak to you this morning. i'm off to change my email signature. to this abraham lincoln quote right now. and you so much. desolate reports its first annual sales drop in more than a decade. shares tumbling. we will dive into that follow next. -- followed next -- fallout next. this is bloomberg. ♪

lizzy: welcome back to "bloomberg daybreak europe." we had the tesla results

yesterday weighing on u.s. stocks. shares sinking almost 6% after the company reported its first annual vehicle sales drop in over a decade. the company selling 1.7 9 million vehicles last year, slightly less than it delivered in 2023. we can dive into those reports with our asia transport reporter danny lee who joins me from taipei. i thought elon musk was really cozy with donald trump. that his business was going to be off to the races and yet tesla shares falling on this first in a decade drop in sales. what's going on under the hood? >> tesla shares had been rallying of late through 2024, but when you look at the hard numbers, the fact that we have had this first fall in annual sales in a decade, sales falling 1%, is really a disappointment to investors. in particular, you see the stock falling because tesla had been

guiding towards a slight gain overall. by not being able to meet that kind of guidance it had been telegraphing, it is a big disappointment and you see the shares falling accordingly. just look at the hard numbers in the fourth quarter, looking carefully, tesla had posted sales of 495 thousand, lower than the 512 expected by the street, and it still lower than the 515 you needed to deliver slight growth. it is a surprise given how much tesla had been trying to drive sales through promotions and incentives towards the back end of the year. lizzy: interesting to see morgan stanley pointing the finger at tesla's aging lineup, how much is that costing tesla? >> it is an aging lineup. it is also that very narrow lineup of evs that tesla

produces and sells overall, which it has not produced another mass-market model for several years now. tesla does have a pipeline going forward which is well telegraphed. we have seen the cybertruck, which is a more narrow set of vehicles. but there is expectation that this budget vehicle for $25,000 that tesla has been talking about could arrive in 2025. that could help rejuvenate sales and capture a bigger slice of consumers tesla has yet to reach out to and compete more effectively against challengers of the chinese ev maker's, of which tesla only just retained its crown as the biggest ev seller from byd by 25,000, so the competition is really breathing down its neck. lizzy: we have discussed that rivalry earlier in the week. i wonder whether these results from tesla change the narrative more broadly for ev's? >> i think, for tesla given it

had so much to do towards the back end of the year, i don't think it changes the fact that when you look at someone like byd even tesla, frankly, they are still in a robust position compared to the legacy automaker sector who are laggards and find it difficult compared to brands such as tesla who can still attract many thousands of sales. lizzy: bloomberg asia transport reporter danny lee. i'm not sure if teslas have hoods. but nonetheless, thanks for looking under the hood with us. now to some other stories making news this morning. apple shares slipping after reuters reported the iphone maker is offering discounted smartphones in china. the fourth down day marks apples longest losing streak since november. reuters says the discounts will run from january 4 to january 7,

knocking 500 yuan off the flagship iphone 16 pro and the promax. china is planning to tighten export restrictions on technology used to make battery components, proposed measures include curbs on extracting gallium and lithium. the move comes a month after beijing responded to u.s. technology curbs by banning several materials with high-tech and military applications. and bloomberg understands that president joe biden decided to block the sale of u.s. steel to japan's nippon steel. the official announcement is planned for later today. the washington post reported senior advisors raised concerns that the move may hurt relations with japan and tried to sway him not to make the move. citadel offered clients the option to cash out profits after a roughly 15% gain in its flagship strategy last year. the vast majority opted to keep

their money in the multi-strategy hedge fund. sources say only about $300 million out of billions of dollars in profits was redeemed. getting profits with high performing is a boon for investors who are increasingly running out of options to allocate money. coming up, more gas concerns in europe after an unexpected outage and worries about supply issues. we will bring all the details next. as we look at futures pointing higher stateside and pretty flat here in europe. stay with us. this is bloomberg. ♪

lizzy: very good morning.

this is "bloomberg daybreak europe." i'm lizzy burden in london. asian equities edge higher after a rocky start to the year for u.s. stocks. concerns about china's economy push the 10-year yield below 1.6% for the first time. south korean investigators failed to arrest impeached president yoon suk-yeol after being blocked by protesters and his security team. the fbi finds no evidence linking the deadly attack in new orleans and the cybertruck explosion in las vegas on new year's day. happy friday, welcome to the program if you're just joining us it's just gone 630 a.m. here in london. we have futures flat to the downside in europe. mildly optimistic on wall street but we did have a pretty disappointing session in the u.s. yesterday. we were discussing those tesla results, they were weighing on the s&p, which fell for a fifth session yesterday.

valerie tytel was talking us through that dollar strength for us. u.s. jobless claims falling to an eight-month low. on the flipside, eurodollar weakness. we are at a 1.02 handle currently. we remain on parity watch as we monitor the fears about trump tariffs on europe, fears about another energy crisis, worries about political uncertainty in france and germany both of which we shall dig into in a moment. gold at $75 a barrel as is gold. and bitcoin trading down today, 96,000 dollars is where we are, that is the first step in four days. flipping over to asia, it was a historically dismal start to the year yesterday but asian equities seem to be back on the front foot this morning. china stocks trading in a tight range after that 3% tumble yesterday. the gun steady at 157 per dollar but we should note japan still closed for that holiday, that's

why we have no cash trading in treasuries until the top of the. hour let's dive into the energy story, european gas prices rising yesterday after a transit deal for the russian pipeline flow through ukraine expired at the start of the year. an outage in norway and the cold snap boosted prices. we can dive into it with stephen chaps can skate. he joins me now from singapore. gas prices closed at their highest since november 23. the question is whether that rise will continue given the cold weather. >> the market is certainly tighter now that they do not have the russians apply. this is something the market was expecting. this is been priced in. you saw yesterday briefly prices were negative for a little while until there was news of an outage in norway, the hammerfest lng export facility will be shut

for a week, that stock prices back up at the end of the session up to the highest level in 14 months. that together illustrates just how on edge of the market is, any disruption, any disruption because of colder weather, will tighten the market. it will result in more withdrawals from storage and the more you take out of storage, the more you have to refill later, that will naturally increases the prices now and across the curve for summer and potentially next winter. every movement, even outage even if it is just for a week, a cold snap for a few days, if there is no wind for a little while results in more gas consumption and there is not a lot of new supply coming online. lng export growth, while there are new facilities coming online in the united states, they are slowly rubbing up production and not able to immediately meet the needs of today, so there is a share of global lng supply that europe has to share with asia.

there is a competition for that supply and that ultimately results in just higher prices. lizzy: truly suboptimal timing for that hammerfest outage. what has been the government response to all this? >> the government has said they are ok. there won't be any shortages. they have found alternative routes through germany and other places to get the gas that they need. and they are correct. gas inventories, while they are lower than normal for this time of year, and while withdrawals were larger than normal in the last quarter of 2024, they still are more than 70% full. there is enough gas physically available to get europe through the winter. it's not so much about shortages, it is just about price, and as inventories get lower, that will increase the price. there will be shortages and europe has done their part in ensuring that, but as prices get higher, customers back out.

it's called demand destruction. you saw that largely in germany in 2022 when large chemical producers said they could not operate any longer in germany. that is an extreme example when prices are at a record high but if power prices rise, or if there is higher prices for industries, then you see ramping down of demand because they figure out how can we figure out a way to lower our power bill, as we face these higher prices? lizzy: appreciate the context. stephen stapczynski, our senior energy reporter. it really puts into context just how urgently europe needs to get its act together. let's turn to the politics because campaigning is underway in germany's election. next week, the csu will hold a caucus meeting near munich. as well we will get a raft of economic data out of europe's biggest economy, factory orders, an all-important reading on inflation on top of that.

bloomberg's oliver crook with us in berlin tracking it all. we are less than two months from the february 23 election. where do things stand now? >> let's tie the economics 40 with the political story by checking where we are looking at the polls in germany. the cdu is still gaining momentum, up to 31%. the afd almost breaking into 21%. we think about the afd getting a lot of prominence in the news recently with elon musk about a month ago deciding he has a really great interest in german politics and backing the afd, calling olaf scholz an incompetent fool, calling the president of germany an antidemocratic tyrant and causing concern across the mainstream political spectrum in germany, not least of all for the spd. they have other reasons to be concerned because they are in third, olaf scholz's party still under 17% and the greens coming in at 12%. but we don't talk about is where

is the support concentrated for these different parties? if we move on to the map. apart from elon musk, support for the afd is really concentrated in eastern germany. this is the former communist east. these two regions of saxony and lower saxony is held by the cdu by only one or two points, the afd stronghold is in the east. the other thing when you look at this map is there is not a lot of red. olaf scholz's across the country has entirely collapsed and is dominated by the great, by the cdu. these are polling for state elections. sometimes people are more willing to make brave and bold political votes because they know they won't have quite as much power, but it shows you the composition of where the support is centered around germany. lizzy: it is not just german politics that elon musk has been waiting into, he has been calling for fresh elections in the u.k. in his latest attack on keir starmer. the economy really dominating

the agenda. just put this period of economic malaise into context for us. >> we have been talking about it the last two years, the economic decline of german industry, and the economic outlook generally being for. -- poor. since 1950, this is the last 75 years of economic growth in germany. the postwar period, a big boost of a percent in the 60's, falling to 4.5%, in the 80's hitting 2.5%. there is that key moment in 1989 when the berlin wall fell in the 1990's. after that, growth has tapered off to 1.5 to 2% and 1% going into the 21st century. have only been eight years of contraction across this whole period of time. two have been in the last two years. that gives context for what is going on in the german economy. there is another story that needs to be told here. it is not just economic output

across germany, it is where that output is centered. you will not be shocked to see that the other map about afd support and the gdp per capita map across germany are almost identical. gdp per capita, germany is still a huge economy, more than 4 trillion euros. but the gdp per capita when you look in the east is under 40,000 euros per head. that is so much lower than it is across the rest of germany. this is a map not just with gdp per capita, you look at where the companies in germany are concentrated, they are in the west of germany. really that huge political, cultural and economic divide that is driving the economic story and increasingly the political story in germany. lizzy: oliver crook, really helpful context. i want to zoom out now to the comic's across the continent. the industrial sector really is struggling but you have war raging in ukraine and this

political vacuum emerging in germany. there was already little chance of a sudden growth revival this year, but now, the threat of tariffs will further delay the region's recovery.is getting more with bloomberg chief climate economist from zurich. what could be the impact of trump's tariffs on top of all of europe's economic woes? >> there are some big questions on how big those tariffs will be. we have had little clarity on that, it is possible as we have seen in the first trade conflict during the first trump administration, that the incoming administration will be pragmatic on tariffs and they will be small. if that is the case, it still creates uncertainty, and we have seen that measures of trade policy uncertainty have soared following the election, and some businesses will want to wait to have more clarity but the economic impact will be small. it is also possible that the incoming administration goes big

on tariffs, that they go for the 20% tariff pledge, so 60% on china and 20% on the rest of the world. if that is the case, we estimate using a large scale model of the global economy that it could reduce u.s. -- du six portion of the u.s. by 50%, and estimate it is a shock of around 1% of european gdp in the short-term losing those exports. longer-term, exporters will find new markets and the economic impact could be small but short talking about 1% of gdp at risk from the tariffs, if they go for the 20% universal tariffs. lizzy: as you are drawing up your outlook for the euro area economy in 2025, what are the big questions you are asking yourself? >> we have heard some of that just now in the program. what happens to the german elections. what happens to german politics. oliver mentioned the german economy has really

underperformed since the covid crisis. we estimate that the german economy is 5% smaller now than it would've been if it had kept growing at the same pace. it is a big economic challenge for any incoming government. for now it looks like more government vacuum that we will face. the reason for that, this 5% weak demand was from weak external demand and high energy costs. that takes us to another big question from 2025. what happens to ukraine? will we see a settlement and what would that mean for energy flows into europe? generally we would not expect a fed increase in european imports of russian gas following any settlement, mostly because of nord stream. there are also questions what happens in france. francois bayrou is the fourth french prime minister in 2024. he still has to pass a budget

that reassures market and provides enough consolidation and goes in the direction of eu fiscal rules, but without facing the fate of his predecessor michel barnier, who was voted down on the budget. lizzy: we talked about ecb president christine lagarde's new year's message yesterday but i should hate to neglect the snb, it has been cutting rates faster than expected, what comes next? >> the snb had a december surprise of 50 basis point cut, when 25 basis points was expected. they have cut by 125 basis points this year. very low rates. in december, it sounded like they were less worried about upside pressure on the franc, but more worried about domestic weakness. we think there is little policy space left but the snb will have

to deliver more cuts. we see one more rate cut in march with risks tilted toward further easing especially if the franc starts to appreciate again. lizzy: maeva cousin, bloomberg's chief trade and climate economist, we thank you for that lookahead for the euro area economy. coming up, why london is the best place to be for that cheeky friday work from home perk. the latest results from our flexible working survey next. do stay with us. this is bloomberg. ♪ ♪♪ ♪♪ ♪♪

lizzy: to the u.k. where researchers and think tanks say that taxes on minimum wage jobs will have effectively doubled in

just a decade, after the government's increased payroll levy comes into effect in april. according to the conservative leaning center for policy studies, total tax paid by employees will rise to 21% of salary for minimum-wage workers, up from 11% in 2015. social media giant meta is replacing its president of global affairs nick clegg with his deputy joel kaplan a longtime executive with staunch republican ties. kaplan has been advocate for more speech from across the aisle on the platform just weeks after donald trump are turned to the white house. a race to attain talent may have prompted london-based businesses to offer more flexibility to staff. the results from the work from home surveyed by bloomberg intelligence shows that 89% of london-based employers are amenable to remote working, more than peers in other european

cities. let's get more details with our senior analyst for real estate at bloomberg intelligence. good to have you with me around the table. one of the conclusions from the survey results, perhaps not really what we would expect by 2024. >> after the pandemic, you would've thought many more people would be coming back to the office. if you look at the number of people who get one to four days, i.e. p are hybrid, they are not fully remote, it is still around 70%. in most of european cities and in new york as well. asia is a slightly different.picture the number flips around a bit. 40% have that hybrid ability because they have more people coming back into the office. lizzy: you talk about these regional differences. is that cultural, economic, can you see trends by sector? why the differ >> i think the situation in the

workforce is important. you know, who has the upper hand. in london and new york, so far, the employer's seem to have been able to get their way more than the employer. and london has always been a tight labor market. we have much lower unemployment than we have in paris. i think that has been the case. we have seen some movement between the totally remote and sort of moving into hybrid. but in london, there is still only 11% of people that have to come into the office every day according to our survey, and that is 7% in new york. lizzy: we have been seeing this bounceback in house prices in the u.k. mortgage approvals as well. how is work from home impacting listed office landlords and where people want to live? >> putting the two together,

there are some other differences coming into that. for example, the changes in interest rates, the changes to demand for housing and where you live, the size of the house, as well as where you are, and not everyone is an office based employee. but i do think the main preferences we saw from our survey for people to come into the office were for networking. funnily enough, productivity. i'm not sure whether that's because they feel that the workload if they come into the office is less. [laughter] which is an odd one. lizzy: we don't chitchat in the office. >> that seems to be the case but networking, across the piece, everybody preferred that. whereas what deters people from coming to the office globally is commute times, commute costs. they are the main difficulty for

people to want to come to the office. lizzy: it been lovely having you face-to-face with me. our senior analyst for real estate at bloomberg intelligence. we have got plenty more coming up on the program. do stay with us. this is bloomberg. ♪

>> you look around the world and there is a lot of chaos. a lot of political instability. people are not currently happy with our governments. what's going on in south korea is clearly a mess. we also have political instability in other democracies like germany and france. meanwhile, we have a lot of geopolitical crises in the middle east between ukraine and russia. it would be obviously a much better situation if the

democracies of the world were stable and united in trying to stabilize the world but they are having enough trouble stabilizing their home fronts. >> does it change the strategy or is it just noise? >> well, i've been in the stay home camp versus go global since 2010, from a u.s. perspective i have been recommending that u.s. investors overweight the u.s. relative to the global economy. by the way, for global investors, i have been saying the same thing, you want to overweight the united states. we certainly have plenty of our own problems, partisanship and so on, but we are carrying on reasonably well. the economy had performed externally well over the past three years in the face of the tightening of monetary policy.

there is a certain resilience in our economy. and our economy continues to do well despite our politicians. i'm not sure other countries are as fortunate that their economies can prosper. lizzy: that was the president of yardeni research speaking to bloomberg's haslinda amin. uncertainty is the watchword hanging over things in 2025. certainly for the euro. we are on the watch for euro-dollar parity. we have got questions about trump tariffs on europe. whether we will have another energy crisis. and all that political uncertainty in france and germany, as we were unpacking with oliver crook. the last time we saw euro-dollar parity was after russia invaded ukraine. 1.02 is where we are trading this morning. if we flip the board, that euro weakness yesterday boosted the dollar.

you can see leveraged funds are their most bullish on the dollar since 2019. you also had jobs numbers from the u.s. lower than estimates, suggesting labor market strength. but this has been feeding into emerging market currencies, closing at their lowest level since july yesterday. if you flip it again, you can see emerging market stocks teetering on the brink of a technical correction. we also had china, a carol massar to the year yesterday if we hone in on that, the worst since 2016. next up, the opening trade, anna edwards and guy johnson will be taking you to the open. this is bloomberg. ♪

>> hello, i'm anner edwards, alongside guy johnson. usually you need to know, sluggish start to the yeah, weakest