>> good morning. this is bloomberg daybreak: europe and these are the stories that set your agenda. asian stocks in u.s. futures fall after donald trump puts a

tariff on all steel and aluminum imports and also warns of levies on cars and ships. openai says no thanks to elon musk, rebuffing an offer for the company. we will bring you reaction from the summit in france where the world's top ai layers are gathering aired and hyper charged hearings for the fed chair. jay powell heads to capitol hill to face questions on trump's policies on banking regulation, diversity and more and a good morning. welcome and checking in on these markets traders continuing to mull whether donald trump's bark is as bad as his bite. we now have a date for when he will implement these new

tariffs. 25% on steel and aluminum. he signed the order so it seems the threat is translating into action and you are seeing that translate into a risk off mood and markets. futures lower on both sides of the pond as we await testimony from chair powell to hear how the fed is thinking about the tariff the rate -- tariff threat implications. we flip the board over and japan is on holiday today so you have no cash trade in treasuries but gold inching towards $3000 because of this risk off mood. and we have brent crude trading at $76 a barrel, boosted by our scoop that the activist investor elliot has taken a stake in bp. you have the pound trading, digesting these comments from the bank of england she decided to go from arch :00 to arch

dove. and we have bitcoin trading just over $98,000 as it processes this. but we have breaking earnings on the terminal. unicredit results for the fourth quarter coming in now. 1.9 $7 billion so a beat on the estimate of 1.6 2 billion euros and unicredit's full-year 2024 total distribution coming in at 9 billion. the estimate is -- was 8.6 billion euros and we will be speaking exclusively to the ceo of unicredit tomorrow at 9 a.m. london time. plenty to discuss, not least how he has been rubbing out with the governments in berlin and rome with his approaches for the banks and a big focus on unicredit's capital position,

how it is balancing, rewarding shareholders with all of this chasing deals. the shares are up 22% year to date so definitely one to be minding at the open. let's get over to asia with avril hong in singapore and a look at how asian markets are reacting to these tariffs. what is happening? >> i guess we are part of the risk off as well. the tariff uncertainty and most of the stocks in negative territory. they pared earlier gains and chinese shares snapping a winning streak but flood the board. i wanted to highlight what's behind a lot of the price action today is that focus on chinese carmakers. we had a highly anticipated event from byd that unveiled that there will be offerings of a free smart driving system across all vehicles. one analyst called it a price cut without a price cut so that is hitting its competitors.

the stock rose as much as 4.5 percent earlier to an intraday record high and it is all -- overall at overboard levels. when it comes to tariffs, we talk about china and japan a lot and i just highlighted what we are seeing in india because some of the analysts or economists from morgan stanley highlight the likes of thailand and india as one of the most exposed when it comes to reciprocal tariffs from trump because if you look at the average from them to the u.s. they are higher than what the u.s. imposes and we are seeing the rupee recently hitting record lows today, jumping by the highest in two years and there is suspected to be intervention coming through from indian authorities so i thought i would highlight as well what we are seeing there. lizzy: avril hong in singapore, thanks for breaking that down. let's get back to that tariff

story. president trump ordering a 25% tariff on steel and aluminum imports affecting all u.s. imports, including from canada and mexico. that levy will go into effect from march 12. take a listen. >> essentially we are putting on a tariff without exception on oil, aluminum, and oil, steel, and it's going to mean a lot of businesses are going to be opening in the u.s. >> that is not it. there are going to be more trade barriers on the way with cars and ships potentially the next targets. let's get more from our opening trade anchor kriti gupta. what to we know about how these tariffs are going to apply and how they are going to interact with what is already there? >> protection is not new and certainly is not something donald trump invented. you heard her talking about the effect on things like the indian rupee, especially amid that commodity shop.

you saw a lot of exports from around the world hit roadblocks in terms of how they will be exported because they wanted supplies for there to mystic audiences. this is taking that to another level. it's interesting it's coming up on reciprocal tariffs because when he announced tariffs on canada and mexico, both nations announced reciprocal tariffs that were not well received. you can see how there are perhaps bridges being burned. you do have some emerging market countries that have the biggest exposure to the story because of those critical minerals. the exception might be different given that the levees are higher and tariffs bring the level down. >> maybe we should get some exemptions. australia being considered. could there be other countries? >> this is where commodity heavy exposure could come in handy. they are exposed to what happens in china, so not only are the major mining exporters but have

that secondhand trade relationship and financial market relationship with china. that's perhaps why australia could be exempted. if you're thinking about raw materials like copper, rare earths you may not get, australia could ultimately be that source. that's one idea. >> you mentioned about whether there were doubts about whether trump and putin had talked. it seems like when they shake hands and who has to be on top but now it's about whether trump and xi are talking as well. >> he has made comment before that there will be some negotiation or conversation between the leaders. we know there was not dialogue between xi jinping and joe biden. he invited xi jinping to the inauguration but he did tell fox that there has been some sort of conversation. it's unclear what that was regarding but the dialogue exists even as he's creating these levees on china and some

of these export restrictions. >> kriti gupta will be back at the top of the next hour with her show as well. let's get into how the tariff story is impacting the fed. jay powell heading to capitol hill today, where he will face a barrage of questions on trump's policies. more now from valerie tytel. a hyper charge tearing. what are we expecting? >> this is the first time powell will be sitting in front of the senate since the reelection of donald trump. he will release a statement at 3 p.m. london time followed by a few hours of some harsh grilling from the members of the senate from the republicans and democrats. it's likely going to focus mainly on the politics here. what does he think about the economic impacts of trump policies and what does he think about the average american having to deal with inflation above target for four years in a row. he also might get questions on

diversity dismantling. is he following trump's executive order to dismantle dei within the fed. lastly, his thoughts on banking regulation. does he agree with the push from the trump administration for deregulation in the banking sector? does he align with that drive from the trump administration. lastly, i want to point out, he may get a different tone from the democrats versus the republicans. we can look at how inflation expectations have diverged. democrats for example see a risk over surgeons in inflation in the next year. republicans don't see that on the cards. you might get a different tone when he's asked about inflation impacts from the tariffs from the trump administration when it comes to democrats versus republicans. watch out for that. lizzy: indeed we will. valerie tytel, thank you. let's go from the macro to the micro. artificial intelligence.

openai's ceo sam altman has rebuffed a solicited $97 billion -- an unsolicited $97 billion bis >> -- bid from elon musk to buy openai. can we deduce his motivations in making this bid? >> yeah. it's difficult to understand how serious it was. elon musk is someone who has a record of acquisitions in the past, twitter or x being the latest, but this one itself, i mean, offering just under $100 billion, i mean, it's not even close to the possible valuation currently being discussed, which is somewhere around $300 billion that could be in play, so yes, i mean, the push elon musk is making is he thinks is time to

return openai to be a safety focused company. i am sure sam altman might say that is already the case, but still, that's what elon musk is wanting. that valuation really falls short of what is rooted today -- is bruited today, around the $300 billion mark. lizzy: could this throw a spanner in the works for openai's plans to transition into a for-profit company? >> that goes back to the motivation. digging into more details on that, it may be that that is really what elon musk is trying to do here, which is to try and draw attention to this transition openai is trying to make, because we know of course openai has followed a not-for-profit structure since its founding. this has been an issue within the company. we saw that sort of spilling

into the public domain in 2023 to 2024. sam altman is someone who wants to shift it into that for-profit structure. that sort of speaks to the feud that has been long-standing between elon musk and sam altman that has taken place because elon musk is one of the cofounders of openai but has sensed criticized it for essentially being too focused on the monetization of ai's potential. lizzy: bloomberg annabelle droulers, we thank you. i enjoyed that ps from sam altman. no thanks but we will buy x, a.k.a. twitter, if you want, but no deal for now it seems when it comes to those companies. coming up, oil and gas giant bp reports earnings later this morning. we will delve into what to watch and how pressure from activist investor elliott may affect their strategic review. that is next. this is bloomberg. ♪

lizzy: welcome back to bloomberg daybreak: europe. it is 6:15 a.m. in london. elliott putting pressure on bp after building a significant stake in the company. the oil and gas major is set to report earnings later today, shareholders hoping the new impetus will deliver strategic transformation. more now from will kennedy, bloomberg senior executive editor for energy and commodities. good morning. take us through investors will be focused on when earnings drop. >> a lot of focus will be on the buybacks. clearly investors are demanding big returns and dividends and buybacks but there is concern with bp in that its latest

buyback may prove unsustainable given a softer oil price and declining refining margins and they may have to pare it back. they will try to get values back today before the capital markets do something into weeks. it will be perhaps not a great set of earnings and it will be interesting to see how weak they are. lizzy: most of the oil majors have suffered from the deteriorating market but as you say bp has kind of been alone in being expected to slow the pace of buybacks. why has it been so much harder up than its peers in context? >> its balance sheet is not quite as strong. it has slightly more debt to service. that goes back a long way and to some extent the period after the deepwater horizon disaster in 2010 where they had to spend billions compensating for that

oil spill and that means the balance sheet has never been quite as strong so it is fighting a little harder to keep that buyback pace going. >> and do we know any more about this stake in bp? it -- is it obvious he would want to break up the company? >> one of the reasons oil majors work is because they are so tightly integrated up and down the chain so breaking out these companies is more easy. that's not a huge proportion yet of the company. they will likely want to refocus the strategy on oil and gas and away from a pivot from what they have sketched out from the company. >> and finally, how can bp respond to elliott? >> that's a good question.

those conversations are likely to be ongoing. they will want to talk to the management team. i think bp was probably going and the direction they wanted. because it is clear they do want to concentrate more on oil and gas production to move away from those aggressive targets his predecessor had set during the pandemic. and it may be the elliott will push to go further and faster but i think it is sort of pushing him even further down the road that he had already set on. >> what an image. will kennedy, we thank you as we look ahead to those earnings at the top of the hour. and i mentioned the financial times interview with the bank of england's former arch hawk turned arch dove at thursday's

meeting. , who voted to cut rates by 50 basis points last week along with someone who expected -- you might have expected would go for our a jumbo move but the surprise move really triggered the market. before they went on to focus on the inflation forecast and the increase in the forecast where the boe now sees it still only returning to target in 2028 but interesting in this interview to get more insight into his reasoning. -- her reasoning. she sees demand weaker before -- weaker than before and it means companies will struggle to reduce prices but she says that this is a one-off move rather than the start of a string of reductions and interestingly whereas governor bailey said that vote split was not a communication signal, they say it was for her.

she says a larger move is a superior communication device to "cut through the noise, so disagree more about the rate path it seems on the monetary policy committee. and now to some breaking news from novartis crossing the terminal this morning and this is that they are looking to buy a -- to buy anthos therapeutics. this is according to a statement that's just dropped with potential additional payments of up to two $.15 billion but that is dependent on achievement of specified regulatory and sales milestones and we are told this transaction is expected to close in the first half of 2025 so we will keep across that story for you. but plenty more coming up. stay with us. this is bloomberg. ♪

(♪♪) now for something you can both agree on a sleep number® smart bed is perfect for couples the climate360® smart bed is the only bed that cools and warms on each side and all our smart beds adjust the firmness for each of you let's agree to agree on better sleep. save 50% on the new sleep number® limited edition smart bed plus free home delivery when you add a base. plus 0% interest for 48 months.

>> welcome back. the french finance minister says that france is going to keep its digital tax that hits major u.s. tech firms despite past threats

of retaliation from donald trump and speaking exclusive to -- exclusively to tom mackenzie he told us more about bloomberg's stance on trade talks with washington. >> he is a dealmaker so europe will answer and we will have our own tariffs and negotiate according to the reaction of the united states. >> europe already has reciprocal tariffs in place on u.s. steel from the previous trade conflict and they are now frozen. is that an easy response for europe to go to, to unfreeze those reciprocal tariffs and let them snap back in? >> i will not give the answer before we have the official answer from europe. >> how much pain is europe

prepared to inflict on the u.s.? >> we are prepared to do whatever is necessary in order to be direct. we have the same tools and we will use them. >> and we can assume the european commission has a list of targets that they would enact tariffs on? >> we are ready and we knew that was coming so we are ready. >> president trump has asked for a probe into taxes globally and one thing about the digital taxes that france has that overwhelmingly impact u.s. tech companies and bring in 500 to 700 million euros a year. would you consider dropping that tax in order to avoid a trade war? >> i not sure the tax issue is related to the trade war but we have put together a tax and we

will see whether that leads to another type of conflict with the u.s.. i hope it will not because it's a question of sovereignty and every country has its own tax system and we will stick to that. lizzy: that was the french finance minister speaking exclusively to our colleague, tom mackenzie. and we will have continuing coverage of the ai action summit in paris. heads of state and government will be the focus today emma -- and we will be speaking with people from the focus foundation later this morning. now to some other top stories. bloomberg has learned donald trump's envoy for ukraine and russia plans to present the u.s. president options in the coming weeks to end the war. the envoy, retired general keith kellogg, will gather at the munich security conference in germany starting friday and the

options step the stage for donald trump to hold direct negotiations with presidents putin and zelenskyy. and elsewhere europe is facing the threat of another energy crisis and storage sites are less than half-full, the lowest level since 2022. cold weather and the loss of russian gas transit by ukraine have forced countries to tap into their fuel reserves. those are some of our top stories, but coming up, gold has reached a record before paring gains as president trump's latest tariffs on u.s. steel and aluminum imports add to uncertainty in the global markets. all the latest next. stay with us. this is bloomberg. ♪ the way i approach work post fatherhood, has really trying to understand the generation that we're building devices for. here in the comcast family, we're building an integrated in-home wifi solution for millions of families like my own. in the average household, there are dozens of connected devices.

connectivity is a big part of my boys' lives. it brings people together in meaningful ways.

lizzy: this is bloomberg daybreak: europe. in lizzy burden and j 90's of the stories that set your agenda. asian stocks in u.s. futures fall after donald trump slaps a 25% tariff on all steel and aluminum imports. the u.s. president warns of levies on ships and cars. openai says, no thanks to elon musk, rebuffing a $97 billion offer for the company. we will have a reaction from the ai action summit in paris where the world's top ai players are gathering. hyper charged hearings for the fed. jay powell heads to capitol hill to face questions on donald trump's policies on tariffs, banking regulation, diversity and more. a very good morning, welcome to tuesday. if we check in on these markets, traders are continuing to now whether trump's tariff threats are merely a negotiating ploy. he has signed this executive order on 25% steel and aluminum

tariffs, so it seems the threat is translating into action. now we are going to wait for the fed chair jay powell to tell us how he's processing the terror threat to inflation and he will be testifying in congress later on. taking it all in stride yesterday. the risk off mood is spreading through these markets. futures pointing lower on both sides of the pond, though significantly more stateside. but if we put the board over to the cross as that picture, japan notably is on holiday so cash trade and treasury's close. but the hottest major commodity of the moment is gold, inching towards the $3000 mark, and we will get more into whether that could pause, if only for short time, what could cause that in just a moment. brent trading at $76 a barrel boosted by that bloomberg scoop that elliott has taken a significant stake in bp. cable air at one dollar 23. we had that commentary from the

arch hawk turned arch dove. we will be hearing more from her at a: 40 5 a.m. london time. you've got bitcoin trading at $98,275. let's get more into the yellow metal, gold rallying in a sign of investor caution after president trump proposed 25% tariffs on all u.s. imports of steel and aluminum. we can get more now from bloomberg's valerie tytel. what has been the main driver here. we know that gold is the safe haven, but what is taking it all the way nearly $3000? valerie: i just want to say it's really not clear why gold has been outperforming so far this year, there is many factors at play, unclear which is the main one. one of which you mentioned would be a safe haven demand from the trade war, but we have not seen a risk off move in the equity market that would perhaps push people into buying gold. we've also seen other macro drivers that play that are supportive, such as the dollar

softening in real yields declining. there is normally a time where gold does outperform on a macro scale. the other thing we have to mention is that china has been buying gold, they have been going away from their treasury holdings to diversify the holdings in their central-bank assets, one of them including going into gold. that was actually something that they did very strongly during the previous trump administration, maybe there is some speculation that china would ramp up their buying of gold of the second trump administration. but again, it's quite unclear why it's outperform so much, there has been some speculation that the u.s. government could look to revalue their gold holdings, which has been talked about a lot within the macro space. the current holdings are marked on the u.s. government's balance sheet at $42 when they came off the gold standard nearly 70 years ago. perhaps if they mark their go to market closer to 3000, generate

some income, that could be something that could spark further influence into gold. that's very unclear why remarking gold would essentially drive the price higher. very confusing on why this is outperforming, but it's really catching the markets i at the moment. >> you mention china, gold stocks on the move from london to new york, what is that? valerie: this is interesting, we seen the steepest drop in holdings here in london as they moved to new york that we've ever seen on record. some of that is because people might be preempting some sort of universal tier four if they did eventually wanted to move their gold holdings to the u.s. they have to comply with the tariff rules if there were universal tariffs. we have seen a big surge into comex gold's, which are gold stocks in new york, they have been leaving london and leaving switzerland, perhaps a preemptive move to try to get around any further announcement of universal tariffs. lizzy: bloomberg's valerie tytel with a deeper look into what's

happening to go, $2921 an ounce is where we trade at the moment. let's get over to china now where china is 10% at this's -- additional tariffs on cars imported from the u.s. is set to hit automakers, including general motors and ford, the extra tariff brings the total of eight to 20 5%. but the situation could be fluid as donald trump plans to hold a call with president xi jingping out of china to discuss that trade situation. katrina nicholas, who leads bloomberg's transport coverage over asia joins me now for more. katrina, which automakers are going to be the most impacted by this and how? katrina: i think automakers like gm and ford are the ones that really stand to lose the most. according to customs data that comes from china, international manufacturers shipped about $3.1 billion worth of these vehicles

with these larger engines from the u.s. to china just last year alone. in particular, i think what will be affected is gm. in a bid to appeal to wealthy chinese buyers, gm recently launched an import service that is offering vehicle services at gmc yukon and the chevrolet tahoe sport utility vehicle, both of these cars are powered by engines that are three leaders are more and this comes at a time consumers in china are already feeling the pinch. so making the cost of these cars even more expensive is just going to make them that much more unpalatable. i think the other thing that relies here for the automakers like gm and ford is that in china they are also competing with really strong chinese players like byd. lizzie: the other big news is from byd. what's getting investors so excited about the latest offering? >> they held a very highly

anticipated event on monday night in shenzhen. at that event byd said it's going to make it's god's eye driver assisted system standard across vehicles price from about 13,000 u.s. dollars and up, including one of its most popular low and models, the siegel hatchback. whereas before you really see byd compete on sticker price, be very aggressive both within china and in the international markets at which it operates, now the chairman is pushing forward into the world of the thomas driving and making that byd's next accessible frontier. the fact that it's going to be added at no extra cost pretty much across the entire spectrum of byd vehicles, i think that's what significant. that is what's exciting investors. they sent shares to an all-time record today in hong kong. lizzy: investor reaction,

positive. analyst reaction, positive. thank you for the update from byd. let's get to the other stories making news this morning. president trump is threatening to cut our foreign aid to jordan and egypt if they don't agree to take palestinian refugees from gaza. palestinians would not have the right to return under his plans to take ownership of the territory. trump has also told israel to call off its cease-fire with hamas unless israeli hostages are freed by midday on sunday. in other news out of the white house, president trump has refused to endorse jd vance as his successor, saying it's too early to make that call. trump's comments to fox news came as the vice president visited europe attending the ai summit in paris and preparing to represent the u.s. over at the munich security conference. >> right now, do you view vice president jd vance as your successor, the republican nominee in 2028? >> know, but he's very capable.

i think you have a lot of very capable people. so far, i think he is doing a fantastic job. it's too early. lizzie: those are the latest lines out of the white house. let's get back to the earnings picture, unicredit reporting fourth-quarter profit ahead of analyst estimates. the beat has allowed the bank to boost shareholder returns even as chief executive andrea pursues takeovers in italy and germany. we can get with our desk at war with our bloombergtechtv bank analyst. they can pass these lines with you now, we've of course got this focus on balancing dealmaking and rewarding shareholders. i wonder if you reckon he's managed to strike it when he's got all of this m&a on the horizon. >> it's a very interesting time for italian banks because of the deals going on so all of the banks are trying to put their best foot forward.

the performance is definitely very strong this quarter. what is most striking for me is the net interest income. they beat consensus by 6% where you are in a falling rate environment, so that you shows very good deposit cost control and hedging as well. interesting -- lizzy: interesting to see them say it's not going to overlap. we also get banko ppm's earnings later today. what are you looking out for, what are investors looking out for? >> for their defense, for her capital returns, they need to prove that they can return more value to shareholders and accepting the unicredit steel. banko bpm is one of the banks that hit harder for the net interest income. so saying a 9% drop in 2025

today they prove they have more resilient net income where they can also boost fees. lizzy: our bloomberg intelligence bank analyst we thank you for that analysis of those unicredit earnings. we will speak to the unicredit ceo tomorrow at 9:00 a.m. london time so you do not want to miss that interview. elsewhere this morning in terms of what to watch out for today, 12:15 p.m. london time andrew bailey, the governor of the bank of england will be speaking, giving us a bit more insight into that decision on thursday and a path ahead, as well as the forecasts updated as they were on thursday. at 3:00 p.m. u.k. time we will hear from fed chair jay powell testifying in a marathon today testimony to the senate banking committee. and then in terms of earnings, as we just said, -- plenty on the docket for you to

watch out today. coming up on daybreak europe, elon musk sets his sights on openai, bidding for the company he cofounded. it was a no thank you from sam altman. we will have more on the response from the openai ceo next, as well as more from the ai action summit over in paris. to stay with us. that's next. this is bloomberg. ♪

lizzy: welcome back to bloomberg daybreak: europe, it is 6:45 a.m. here in london and we are waiting for results from caring, the luxury group. the owner of gucci really trying to project stability after this series of guidance of cuts, management overhauls, the new ceo at the top there. also the surprise departure of the creative director as well. the question really is whether management has a clear vision for gucci, its flagship brand and those results dropping on the terminal. for the fourth quarter, we have revenue down 24%. the estimate was for a drop of 22%, so worse than expected. they say they saw slight sales

improvement between the third and fourth quarters. it is coming in at 4.6 7 billion euros. the estimate being for 4.1 6 billion euros. so a slight beat there and kering saying it has plans for more deals with property funds to cut its debt. so sales tumbling as his turnaround fails to take shape over at gucci. can they improve things now that they have made these changes at the top, the change in terms of their creative director, one of the first major decisions by the new ceo, who took over that role in early january. so those results from kering dropping shares down 40.71% over the past year. let's stick with the corporate and turn to tech because as we mentioned earlier, the openai ceo sam altman has rebuffed a 97 billion dollar bid with a group of investors led by elon musk,

who cofounded the company. they want to buy the nonprofit that controls the chatgpt creator. the bid is seen as a move to complicate openai's transition from a nonprofit to a for-profit entity, looking out more now from tom mackenzie, our anchor who's on the ground at the ai action summit over in paris. good morning, tom. the fact that altman turn this down, no thank you is what he said, is that a surprise? tom: not really, no. these two, musk and sam altman have been in the war, a feud over the direction of openai. don't forget that going back to 2015, the founding of openai, elon musk was one of the first investors. this was a plan they put together, sam altman and elong must work together to build out openai in the early stages, but since then, they have diverged dramatically because elon musk says the organization and start

up under sam altman has moved so far away from its mission of providing safety focused ai open to the public and a nonprofit. openai pushes back on that characterization, of course. they are also in a legal battle or two. this complicates that effort by openai to shift from nonprofit to a multibillion-dollar profitable organization at a time when they are trying to raise funds and looking at a valuation of $300 billion. we don't know how seriously to take musk's bid but according to the report from the wall street journal, he has lined up serious investors. this is another step in that feud with elon musk and sam altman will put a ridge in the works. it's backed by microsoft about 13 billion in could be getting

$25 billion from softbank as well. it certainly for openai up at -- openai and a step up for these two tech nobles. lizzy: that will be one of the themes at the action summit. we always knew that deepseek was going to be another theme hanging over it to the google deep mine boss saying that some of deepseek's claims about the relatively low cost of trading is exaggerated. along with leading industry figures talking a bloomberg over there in paris about the impact of deepseek on the ai industry, take a listen. >> at the very president model and precedent piece of work, i think the team is probably the best team i've seen come out of china. that said, i think a lot of the claims are exaggerated in a little bit misleading. >> a lot of the key themes from deepseek are reducing the cost of innovation, but also raising a question of data control. >> you have more constrained

resources. if you have immense resources then stop thinking about what to do. bikes there is a global competition between whether the world will be built on small d democratic ai rails or authoritarian autocratic ai rails, and that is the big take away from this. >> there's been a lot of excitement, but we will have to see if it materializes. lizzy: we always knew it was going to be a deep talking point over there in paris. tom: it has been one of the key talking points amongst executives here at the patent -- paris ai action summit. i think their messaging on the response from the ceo of google deep mine was the most and clearest enunciation of what deepseek has been saying. he said they were slightly misleading and exaggerated their claims around the cost that they used and spent to train their model. he basically said during the final phase of trading -- training is what's counted for deepseek. he said there's a whole lot

that's much more expensive and it doesn't seem to be accounted for. he also said it doesn't seem to be a silver bullet and he also claims that gemini, google deep mines own model, is more efficient than deepseek but this has been a key question for executives on the ground here in in paris. lizzy: the executive's tussle between each other and decide how they will deal with deepseek, there is the role of government as well, and the french finance minister has said that france is going to keep a digital tax that hits major u.s. tech firms, despite the threats of tariff retaliations from president trump. you were talking to him, what else did he tell you? tom: we focused on the tariff response, and we focused on our digital services tax. france one of the first service is to put this in place in 2019. 3% on the revenues of big tech companies. inevitably picked -- u.s. tech companies. it raises 700 million euros for

french coffers on the french government. the question has been, given that trump has come into office again and has ordered a review of international taxation policies that could potentially target u.s. companies, the question has been would france consider removing the digital tax if it means avoiding a trade war with trump? we know trump does not like this and thinks it unfairly targets technology companies in the u.s. the french finance winner said no, this is not for negotiation, this is our sovereign tech -- tax. take a listen to the french finance minister. >> we are prepared to do whatever is necessary to be balanced. we will use them. it is not a negotiating tool, we have it in place already. we will have a discussion with the u.s. administration.

tom: france finance minister speaking to me saying france, the european union is prepared to hit back to these trump tariffs. he says he prefers a negotiated deal. lizzy: tom mackenzie at the ai action summit in paris. thank you for those fantastic interviews. there will be plenty more of them throughout the day and plenty more on daybreak europe. do stay with us. this is bloomberg. ♪

lizzy: welcome back to bloomberg daybreak: europe. in our last few minutes let me bring you the question that really is on trader's minds at the moment. what is bark and what is by when it comes to donald trump's tariff threats? is 25% tariffs on steel and aluminum have had the executive order issued.

it does seem it is translating into action and that's what's on investors minds. tariffs topics to shore. the s&p 500 company transcripts rocketing, as you can see, over the past few months. you can see partly the market impact on gold. gold inching towards $3000 an ounce. but it's not all down to tariffs. it is partly this flight to safety. but if we flip the board again, it's not just tariffs on your mind, it's also powell's testimony. he will be asked about tariffs undoubtably on the impact on inflation and inflation very much on the fomc's mind as well. that does it for daybreak. the opening trade is up next. this is bloomberg. ♪ and all our smart beds adjust the firmness for each of you and now, save 50% on the new sleep number® limited edition smart bed. shop a sleep number® store near you.

the way i approach work post fatherhood, limited edition smart bed. has really trying to understand the generation that we're building devices for. here in the comcast family, we're building an integrated in-home wifi solution for millions of families like my own. in the average household, there are dozens of connected devices. connectivity is a big part of my boys' lives. it brings people together in meaningful ways.

anna: in hour away from the opening trade, a profit beat for unicredit sees