tom: good morning, this is "bloomberg daybreak: europe," i'm tom mackenzie in london. another day, another tariff

threat. president trump orders a plane for reciprocal levies on trade partners around the world with a report due by april. asian markets gain on the extended timeline. a 50 percent cut in defense spending. donald trump floats talks with russia and china as a way to radically reduce military budgets. we discuss geopolitics from dem munich security conference. bloomberg learns hsbc is to start cutting investment banking jobs in asia from next week. that's as the ceo of europe's largest lender overhauls the bank. tom: happy friday. yesterday you notched fresh records on european stocks. the slow burn on the tariff threat from the trump

administration giving relief to markets. european futures pointing lower 0.4%, within the context of that record high yesterday. ftse 100 futures flat, s&p futures stateside close to record highs yesterday, looking to add 0.1% so far. nasdaq 100 futures also pointing to gains. we just lost a connection but the cross assets board will reflect what is happening in terms of a relatively benign treasury market. this week you had inflation data that came in slightly higher than expected. producer prices yesterday as well higher than forecast, yet you lift the hood on the producer prices, and the components that feed into the key pce gauge scrutinized by the federal reserve, those components looked less concerning for many economists who are parsing that data. euro-dollar currently one point 04, brent on the oil story currently up 0.2%. strength in the oil markets and

gold not too far off $3000 per troy ounce for the yellow metal. let's cross over to singapore where avril hong is standing by for a check on the asian markets. avril: we're seeing asian markets in a pretty good mood. this is the third session of gains. if you look at the weekly performance, it is their fifth in the green. yesterday was about prospects of peace. today it is about tariff delays, but also, how chinese tech stocks with that late session stumbled just a day ago managing to get their mojo back today, after these details we are getting about how apple will engage with chinese tech names, alibaba and now baidu in the mix, to offer ai features on iphones in china. we have that timeline by the middle of the year. that is fueling the chinese tech stocks. amid all this, there is a bit of caution, trump reportedly did single out japan and south

korea. there are not just stocks gaining in asia so arehe currencies and for the offshore redmond be reversing -- renminbi reversing yesterday's rally. i thought i would put into context how chinese stocks are getting their tailwind from these valuations. if you look at this chart courtesy of mliv's merriam nikola, it shows the equity risk premium higher than peers, it makes you wonder do chinese tech stocks overall protect from the tariff noise? is that an option now, especially given the deepseek narrative that's underway. tom: equity markets in asia re- finding their mojo. avril hong out of singapore on the asian markets. donald trump has ordered his administration to consider imposing reciprocal tariffs on trading partners, as he targets a global trade system he

complains is tilted against the u.s. also warning that import taxes on cars, semiconductors and pharmaceuticals over and above the reciprocal tariffs will follow. pres. trump: reciprocal tariffs, that's two words, reciprocal makes tariffs really fair. >> no exceptions, right? pres. trump: there would not be any exceptions. tom: we understand then measures may be implemented by april. for more let's bring in opening trade anchor kriti gupta. what extent do we understand the importance of these tariffs, and whether this is just another negotiating tactic from trump and his team? >> all of the above is the right answer. this is 100% a negotiating tactic. we see an element of that with the way he has talked about mexico, canada, colombia, even china. you see that in the delay baked

into april where it was originally meant to be march 1. that is showing up as a means to kickstart those negotiations. the other piece of this is that reciprocal tariffs are something he talked about on the campaign trail for a long time.the new piece of information here is it is not just tariffs, not just that if an emerging market country has tariffs on american exports, then that percentage will be matched from the u.s. it is other things outside of tariffs, he is talking about things like nontariff barriers including subsidies, relations, value added taxes, and exchange rates. you talked about the chinese currency manipulation in his first administration as well. for your of interesting pieces the regulations. he talked about european tech relations naming the likes of apple, microsoft and meta as being quote tree down fairly by european regulators. subsidies has a lot to do with

agricultural products. the united states subsidizes its farming sector, most countries do for agricultural goods, but the u.s. number one export as agricultural goods, second is boeing airplanes, so this idea of tackling subsidies in farming around the world would help the export story for the united states. these are other things we are trying to wrap our heads around about which would be targeted and which would be ways to calculate what those tariffs look like. tom: maybe the importance is less about the tariffs, maybe on the nontariff barriers, very interesting particularly when it comes to e.u.. the indian prime minister has been in the white house. this is also a protectionist market. has narendra modi put out a template for how to negotiate with trump? >> he hasn't set up a negotiation but the fact that he is one of the early leaders to come to the white house is quite telling. especially because there is an economic relationship between

the united states and india that a lot of people don't fully understand, specifically when it comes to the defense sector, and that is important because the united states does not have as much market share in india's arms market as russia does. unlike major allies of the united states. that will be a crucial piece. the other is h1-b visas, this impacts the tech sector, india has its own burgeoning tech sector in bangalore, but the visas is crucial because this is coming amid a very hard line on immigration. that will be crucial in terms of seeing just how you start to address the labor shortage and actually help some companies that he says are under scrutiny from the likes of europe. tom: people like elon musk are in favor of those visas. kriti gupta, thank you indeed. investors appear to be chairing

donald trump's decision not to implement reciprocal tariffs right away. us get more from valerie tytel on the market reaction. valerie, talk us through how these equity markets and fixed income have reacted then. a bit of a struggle arguably to the latest tariff threats from trump. >> the fact that these tariffs were not implemented immediately, but that there is going to be delayed, possibly until april paves the way for a risk asset rl yesterday, the s&p yesterday closing a whisker away from all-time highs. frankly april 1 is light years away for this market. it paves the way for this rally to continue further. we also saw the dollar softening off the back of this tariff delay. the bloomberg dollar index yesterday closed down 0.7%. we can look at how the dollar has fared is the highest of mid-january. we are now down over 2% from january's peak for the bloomer dollar index, on the back of

this softening of language when it comes to tariffs from donald trump. we were braced for immediate tariff action but it is just delay after delay on that front. we can talk about one asset that is not holding back and that is european stocks. we saw the euro stoxx 50 index, that's the mega cap index in europe reach its highs seen 25 years ago to close at a new record. this is accommodation two things. both that tariff delay, add onto that hopes for an end to the ukraine war boosting european stocks, we had that euro stoxx 50 breaching those highs seen 25 years ago, the bull case for european equities rolls on. tom: there we go. despite all the headwinds geopolitically and potential challenges. valerie tytel on market reaction to the latest trump tariff threats. alibaba's chairman says apple

iphones will use its ai technology. this as the u.s. tech giant's china business faces significant challenges from geopolitical tensions, tariffs and anti-american sentiment in the region. let's bring in robert lea from our intelligence team. how significant is this partnership for both alibaba and apple? >> i think the quick answer for that and that applies to every company tied up in this new story, baidu here which is the google of china, it is good for sentiment for all three companies. but what is actually been to the bottom line? i would argue the impact for all three companies is fairly insignificant. tom: -- >> i can elaborate -- tom: david ingles, keep member of our team in hung long pointing out that the word for laugh in chinese is i, as in i love you, interesting in the context of the fact that there

has been this catalyst in terms of the money flowing into chinese tech stocks. because of "i" or "ai" talk to us about how apple could transform that company's prospects that have been challenged in the chinese market. domestic competition of course, but also, some restrictions as well. >> in terms of china's smartphones, as is the case across the whole world, this is commoditized technology at the moment. the days are way behind us. what we have seen the last five to 10 years in china is foreign brands, with perhaps -- including apple actually -- have come under pressure or get squeezed out. there was a time many years ago where samsung was the number one selling brand in china, and it is hardly in the market these days. the reason for that is the commoditization of the technology, local brands have really narrowed the gap, the

technical barrier to entry isn't particularly high. and chinese brands are more attuned to local needs. the software and apps that come on them are of more interest to chinese consumers. in terms of the features, whether it is camera, price points as well, they are priced attractively offering premium features but at discounts to western brands. this is what western brands under pressure, samsung and others have effectively exited the market. apple is under intense pressure, will apple intelligence transform its prospects? it seems hard to that's going to be the case, iphone competes on many local smartphone brands the last nine to 12 months, so apple has really played catch up in the china market. perhaps at best it could help stabilize his share because we know there is a lot of tribalism in terms of smartphones.

if you like apple, you are probably on it for life, but it will be difficult in a commoditized sector without competition from local brands to really narrow the gap. tom: so apple still playing catch up, maybe alibaba is the bigger beneficiary with their earnings next thursday, in terms of the potential lift from investments around ai. robert lea with a breakdown, thank you very much indeed. global leaders meet at the munich security conference today with the goal of working towards a peace deal for ukraine. we report live from munich. that is next. this is bloomberg. ♪

pres. trump: i believe he wants peace. president putin, when i spoke to him yesterday, i know him very

well. i think he wants peace. he would tell me if he didn't. it is not a question of liking russia or not liking russia. it was the g8, and i said what are you doing? while you talk about is russia, and they should be sitting at the table. i think putin would love to be back. tom: u.s. president donald trump speaking about his meeting with russian president vladimir putin, or at least, his phone call. president trump is also proposed a meeting with his russian and chinese counterparts to discuss cutting defense spending in half. let's get to bloomberg's oliver crook at the munich security conference. ollie, this is a major event over the next two days, and the trump plan around ukraine will be scrutinized. how seriously should we take this proposition, is he just airing an idea talking about cutting defense spending with china and russia 50%? or how seriously do we take this, should people on the

ground at the meeting security conference be taking this? >> it is very hard to say how seriously we should be framing it. we are in the right place at the right people how they are feeling about it. we are speaking to ceos of defense contracting companies later this morning. when you hear that the u.s. was to have his military budget, china, russia that will have huge impact for many of these companies because they are in ramp-up mode for the europeans who are wanting to be spending more. 24 hours this week has felt like a very long time. it began with that trump-putin call beginning negotiations, putting things on the table that the europeans were not pleased about, though many of the things were already seen as inevitabilities in peace negotiations, giving up some territory, nato membership for ukraine not on the table, but europeans have been unhappy because they have not had a seat at the table. on top of that, we were hearing potentially there is a meeting in munich with high-level members of the ukrainian, russian and u.s. delegation. we had not heard that until president trump suggested that

yesterday. we don't have a huge amount of detail on whether that is possible. the ukrainians on their side said basically they will not enter any talks with the russians until formal negotiations begin. as you can imagine, bringing all these threads together as they drift from the united states across the atlantic will be a great challenge for all these leaders, defense minister's and companies that will be meeting just behind me in the hotel. tom: where does it leave europe in terms of its involvement with ukraine? president emmanuel macron speaking to the financial times, not being directly critical of the trump plan on ukraine, but european leaders clearly what that seat at the table. >> exactly but here is the problem is they cannot do anything but ask. there is no way they can impose themselves on these negotiations. that is frankly their own sort of fall because they have not been spending on defense.

unless they have a strong military presence, they cannot support militarily ukraine allowed, they don't have a voice, that is an issue by the way donald trump emphasized for many years about the europeans. what might coal was referring to is the trump trade is electroshock for europe and europe needs muscle up on defense. we heard something similar from the potential next chancellor of germany saying basically he's expecting a very x aggressive speech from jd vance at the event tonight and suggesting that europe is on it's on. this was the idea that was flooded when i spoke yesterday to carsten brauer, the top general in the german military, when the politicians talk about promises, he is the one that has to execute it. >> what we still see is that russia is a threat to europe. the entire negotiations over the last 24 hours will not change this.

my perspective is that we have to see the security of anti-europe first.this is what i am responsible for. to look into the security for germany and of course with my allied colleagues over entire europe. >> we talk a lot about the money that needs to be spent on hardware. this is a major issue for the europeans but there is another question, one of also manpower. we were talking yesterday with the general about do you have the number of people required to secure europe? he says not even close. the money has been enough to fill in the potholes. you are not where you need to be on the money and you need more people. we talked about potential conscription in germany. he said that yes, they well potentially. they want to do it on a voluntary basis, but these are all the conversations that have to be happening, and these are difficult conversations politically as you know. tom: the conscription debate is

being aired in germany, and has been aired in the u.k. oliver crook joining us out of munich, who will be covering that conference for the next three days. we will have special coverage from the conference and interviews with the german foreign minister as well as leaders at saab and cummings bird defense and aerospace. hamas says it will free hostages on saturday. the latest from the middle east next. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak europe." thomas says it will free hostages tomorrow as scheduled, backing down from a threatened delay that had cast out on the durability of the ceasefire frieden williams joining us live

from jerusalem. what do we know about this apparent decision by hamas to release the hostages? why was there a standoff and what has led them to commit to continuing around the ceasefire and release of hostages tomorrow? >> there was a cascade over termination accusations that appeared for -- recrimination accusations that appeared for a week to be leading to the resumption of war with israel. mustering new forces inside the gaza periphery saying if there would be resumption of the war, it would be of different intensity and would lead to the defeat of hamas and the implementation of trump's controversial idea of relocating the bulk of gaza palestinians abroad, so the gaza strip can undergo a makeover led by the united states. the rhetoric was very fierce and it appears that hamas has relented, and this latest

hostage release is on track to take place tomorrow. the original reason given for hamas alleged that israel had not met obligations regarding humanitarian relief for the gaza strip as part of the stage of the truce. israel denied it. hamas may have been testing the waters. they may have been wondering which hostages to release next and in what condition. when the last batch of hostages when free on saturday, they were remarked upon for their awful appearance, they were emaciated and dazed. president trump described them as recalling holocaust survivors. there was speculation that hamas was trying to buy time to feed the next batch of hostages, maybe choose the next batch of hostages appropriately, so that their appearance would be less shocking and less deleterious for hamas' international image.

it is worth watching tomorrow when this hostage release happens, the pageantry if you like, the stage managing around it, if hamas is trying to tone down things given the blowback for what happened last saturday. we are waiting to hear the names of those hostages who will be going free and in exchange which palestinian prisoners israel will be releasing. tom: what do we know about the prospects of stage 2 and 3 of this ceasefire? >> that is a terrific question. everything is up in the air. this is really where the rubber hits the road because the current stage is pretty much agreed upon. it is interim, it is a short, defined truce of six weeks but when to enter the coming stages of the truce, it becomes existential. why, because israel wants a long-term truce to entail the end of hamas rule in the strip, hamas has given no indication it would relinquish power, and israel said it is willing to go

back to war to destroy hamas should there not be an agreed solution. neither side is giving in on this. it is hard to see how either side would accommodate the other in turning this truce into a more sustainable deal. but we are near a decision point. it will have to be decided in the coming days because otherwise this truce will fizzle out when the six-week period is done. tom: dan in jerusalem on the prospects of this ceasefire being continued between hamas and israel. we will switch focus to the corporate space. banking and hsbc said to be planning fresh investment bank job cuts. stay with us. this is bloomberg. ♪

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tom: good morning. this is "bloomberg daybreak europe," happy friday, i'm tom mackenzie in london. another day, another tariff threat. president trump orders a plan for reciprocal trade levies on partners around the world with a report due by april. asian markets gain though on the extended timeline. a 50 percent cut in defense spending. donald trump floats talks with russia and china as a way to radically reduce military budgets. we discuss geopolitics from the munich security conference. bloomberg learns hsbc is to start cutting investment banking jobs in asia from next week, as the ceo overhauls europe's biggest lender. checking markets this friday, european futures pointing softer, down 0.4% after fresh record highs for the stoxx 600 yesterday. european stocks continue their gains, today though pointing to

a bit of profit taking, and possibly awaiting some data out of the u.s. retail sales data out later today, good to give us a gauge of the health of the u.s. consumer. inflation continues to be a topic of discussion and where it leaves the federal reserve with markets pricing just one cut by the end of this year. s&p futures after adding around 1% yesterday looking to further gains of about 0.1%. as tech 100 futures pointing to gains of 13 points having rallied yesterday 4%. it is the slow burn of the trump tariff agenda giving some relief to markets freed let's have a lacrosse asset. stability across the treasury markets today after some volatility on the cpi data earlier this week. and testimony from jay powell. euro-dollar at 1.04. brent currently up 0.2%. and gold continues to close in towards that $3000 per troy ounce level, currently up 0.2%.

some breaking news in the last couple minutes around what is happening in china. president xi jinping is expected to be holding a symposium focused on the private sector. this according to reporting from reuters. and in attendance will be alibaba's jack ma, of course, the founder of that business. i believe this is the first time jack ma will be in a room with xi jinping at least publicly acknowledged since the speech that he gave, momentous, in october of 2020 that led to the removing and ending of the ant financial ipo and essentially a long run dressing down of jack ma. all above us fortunes have turned around as well, adding $40 billion to market cap just in this year alone, on the investments that have made in ai. they have now partnered with apple to provide some ai services on the iphone in the chinese market. we will watch that stock. currently up 4 percent in

the session. hsbc is kicking off fresh round of job cuts at its investment bank as the new chief executive overhauls europe's biggest lender. redundancies will start in asia as early as next week. let's bring in our reporter in hong kong who helped report the story out for us. manuel, walk us through the details. the job cuts continue at hsbc? >> the job cuts set to continue at hsbc, europe's biggest lender. we expect that to start happening as soon as next week. the bank is set to report earnings as well. in their restructuring, the overhaul of hsbc has been going on quite some time already. you explained the ceo is looking for ways to streamline, boost

efficiencies at the bank. just a few weeks ago, they announced shutting down of some advisory and ecm-related services in europe and the u.s., and people in asia also worried about how that is going to impact the bank and their business here. the job cuts are part of the cost-cutting efforts by the ceo. as he tries to revamp the whole structure of the organization. but there is more to come for sure as the bank becomes more of a so-called boutique in a with balance sheet. they are trying to find new ways to continue to serve clients but in a more nimble and smaller way. it will be interesting to see how many people in the end get affected by this new round of

cuts. the details are still unclear. it will become more apparent after full-year earnings are reported next week. tom: the stock did not perform badly, there were some choppy moments, but did not perform badly under former ceo noel quinn. what is the rationale for the restructuring plans and how effective have the changes been so far? >> the stock didn't do that badly. it is a more long-term approach to where banking is heading. we have seen reorganizations across all the major banks in wall street. dear in asia, the ongoing layoffs over the last few years have been quite notorious. and to some extent in europe and the u.s.

the new round of cuts goes beyond a specific period of time, where the stock performance as you said has not been that bad. it is mostly about long-term what hsbc's strategy is going to be. and what they want for the bank in the long term. i believe they are adjusting to a new reality and to a new geographic footprint. what is unclear yet is how that will pan out when it comes to business areas such as m&a and ecm, for instance, how that will impact clients and potential mandates they have ongoing. that is a big question mark right now. tom: manuel bagiorri reporting the latest scoop around hsbc and what restructuring could mean for that lender. bloomberg learned that spanish

bank santander explored a potential sale of its u.k. retail business with natwest. sources say early talks took place last year and both parties remain interested in a deal.the british 7:00 a.m. u.k. time. natwest's ceo will give his first tv interview since taking the job. that is at 7:00 a.m. u.k. time, so stay tuned for that interview coming up in less than -- little over 20 minutes time. that interview with the new ceo of natwest. jp morgan will scale back spending on diversity initiatives that he sees as a waste of money, while reiterating the bank's commitment to working with black, hispanic and lgbtq staff. answering an employee question, the ceo said the plan to cancel some initiatives were about costs that went too far rather than blowback from the new trump

administration. to germany and politics of that nation as they lead up to the elections pray chancellor olaf scholz is counting on undecided voters to close a big gap in the polls ahead of next week's elections. scholz spoke during a q&a on german television, adding that he is still optimistic he can win. a spring in christoph in frankfurt with more. what is the reality and the likelihood that scholz can in fact turn things around. 22 data, around 40% of voters are not fully committed to a party. >> yes, this was actually the one new line olaf scholz offered on tv last night. as you said, the numbers for him look pretty much unchanged for several weeks. he is gradually running out of time. we only have one more week until the federal election on sunday

on february 23. people did not learn a ton of new things to be honest last night. he essentially repeated his narrative on domestic security, how to revamp the economy but it was difficult to see how that debate would spark new momentum for him in the election campaign. tom: what are the latest polls showing about the leading parties, how are the cdu doing versus the greens? >> we did get some fresh numbers last night. essentially, they did show smaller changes among the smaller parties, but nothing too material. for the bigger ones, the picture was unchanged. but conservatives are leading currently with 30% follow by the far-right afd with about 20%, then there is a significant gap, follow essentially by the social

democrats party of olaf scholz, and the greens who are both around 14-15% maybe, so that picture from an overall view looks unchanged for several weeks now. tom: they were 40% undecided voters, it is in fact 30% on shore, an additional 18% either don't intend to vote. i will just correct that, i said 40%. the latest when it comes to the german election. that vote taking place on the 23rd. we will bring all the market moves as we build up to the german elections later this month, including a special program when polls closed every 23rd, live from berlin. later today francine lacqua moderates a panel from the munich security conference on the future of u.s.-ukraine security cooperation. what a topic given trump's plans with the ukrainian president

vladimir zelenskyy and u.s. senators including lindsey graham. apple and google have restored tiktok to their app stores following reassurances from the u.s. attorney general that a ban when not immediately be enforced. the two companies moved that -- removed the appa to comply with congress. starbucks ceo brian niccol is wrapping up a visit to the gulf region, or the u.s. coffee chain partnered with q8-based group since 1999. it'd is been tasked with turning around the brand that has faced controversy over unionization and boycotts over the war in gaza. he spoke exclusively to bloomberg's joumanna bercetche in dubai. >> the boycott and that whole information cycle, it's really unfortunate because obviously it

hurts the brand.it hurts our partners and the stores. the thing that is disappointing about it is it is not based on anything accurate or true. we have never supported any militaries. tom: brian niccol, starbucks ceo, speaking to joumanna bercetche you earlier. the ai revolution looks set to transform health care. we will discuss with lateral labs' ceo and founder simon kohl . that is next. this is bloomberg. ♪

tom: welcome back to "bloomberg daybreak europe." startup latin labs caused a stir after raising $50 million to discover new drugs that will use ai to make biology quote programmable. the technology has benefits notably cutting the costs of finding new drugs. joining me is lateral labs ceo and finder simon kohl. you were previously at google deepmind around apple fold makes you stand out in the space but you have big backers as well. this is a competitive space. we come across a lot of companies using ai to develop drugs. what do you guys do that sets you apart and how will you

deploy this cash? simon: we are indeed working on making biology programmable, we are working on protein design first, building frontier ai models that learn the fundamentals of biochemistry. we will apply these successfully to antibody design, protein engineering such as enzyme optimization, genetic engineering. and we believe there is a big opportunity to essentially move the drug discovery process that is currently dominated by experimental discovery into the competition around. that is our northstar, essentially, make this a computational discipline thereby speeding up the process, opening up wide spaces that are not accessible with the current techniques today. tom: what does the $50 million do to get you closer to that goal? simon: it allows us to accelerate r&d, get more computer resources required to train these models, expand our teams and get the commercial traction we are looking for. enabling our partners, that's

what we're setting up to do with this race. tom: you are buying gpus, who are you buying them from? simon: we are working with cloud providers. we have not disclosed to we are working with yet. as you know, it is a business that runs on gpus. and we are scaling up. tom: what is the potential market opportunity then? simon: it is big, the space as such, even biologics is a trillion dollar market where if you can compress the timelines, reduced risk, even open up new areas of difficult targets we think there is a massive opportunity here, tapping into that is what we are looking to do. tom: i have spoken to dennis of google deepmind about this around when we get our first ai-discovered drugs and he gave a timeline of 12 months, of course, there is the clinical trials part of it as well. when did we cai-developed drugs

in our hospitals? simon: it is still early days. ai is transforming the industry. we are seeing real progress today. but famously of the timelines are long, 10 to 15 years, we are shrinking these but it will take time to go through the entire procedure. we think especially the first third of the process can be shrunk down massively. we will see acceleration, it will take time. we are getting much closer to these results but it will not be tomorrow. tom: what are conversations with regulators like? how open are they and how willing and nimble are they to adjust to the developments coming out of your sector? simon: everyone is watching quite closely. there are new questions being raised. it is a space that has not converged. we are engaged in conversations. we are happy to talk with regulators more. i think there might be some

change to be had to accelerate this further. tom: do you get a sense that there is willingness from regulars to move more quickly, particularly when it comes to clinical trials? simon: they have a fiduciary care to be balanced with the benefits of more speed and breadth, and they are taking this seriously for good reason, i think they are interested but it needs to be done with appropriate care. tom: there is increasing competition within your space. do you see consolidation? you have quite a different business model to some of your competitors. does it lead to consolidation? simon: it is so early to be honest.alpha fold, the model that won the nobel prize for chemistry last year, is four years old by now. we are seeing advanced ai models making massive impact trade we have yet to see this fully play out. in our industry, there is a couple of players in this space. everyone has slightly different

hypotheses. it has not converged. it is like several rockets launched into orbit and they will all reach orbit because this space is huge. we are far from consolidation. tom: what about future funding plans. you have raised 50 million, does that secure you for 2025? simon: we have raised the appropriate amount to accelerate our mission. i think it is exactly right. we will double down in all these areas i mentioned earlier. and we will be looking into how to grow from there. tom: because you have been in stealth mode. you have been giving a very low profile and part of that is you just want to build and execute and ship quickly before your competitors pick up on it. now you are out in public. is that tide you over for 2025? simon: we have a fantastic machine learning team, we have our own lab in san francisco, we have been able to do that in stealth. tom: which parts of the

pharmaceutical space are most ripe for the kind of innovations, are they cancer drugs, is it other parts of the space? simon: for us, it is largely biologic, that means protein-based drugs such as antibiotic, and cancer drugs are one of the obvious ones to go after, they are a very big and impactful market and we are excited about that. tom: we wish you luck. we will continue to monitor how you guys fare no need for consolidation. , plenty of space to grow in a potential trillion dollar market. there is plenty more coming up. stay with us. this is bloomberg. ♪

>> the first thing for investors to do is understand what is the full potential adverse impact of tariffs if they are implemented? >> higher prices and lower growth because everything will be more expensive, and also, the tariffs will disrupt supply chains so that will also lower productivity growth. >> we have seen that when tariffs were announced on canada and mexico, they were preparing retaliatory tariffs, it is very unrealistic that other trading partners will sit by as the west puts tariffs on them. >> what is his plan? it is very confusing for our trade partners not to know what it is that he wants. >> to goodews is markets get a little desensitized to it. people realize that donald trump is a very unusual president. tom: bloomberg markets live pulse survey showing investors are bracing for further weakness in the u.s. treasury market as they bank on president donald trump's tariff that's becoming

reality. no specifics from the press conference yesterday around additional reciprocal tariffs, and that is giving markets relief. here is the breakdown in terms of the deficit that animates the president. the u.s. deficit versus china, versus mexico and the u.s. deficit versus the e.u. in blue. that is what animates the president even though it tells you more about the strength of the consumer and a dollar than it does about countries taking vantage of the west, that would be the contention from many economists, but that is the focus for the president. let's have a quick look at european stocks because despite the volatility and geopolitics, euro stoxx 50 breaking through fresh records, levels we have not seen since 2000, the euro-dollar is back on a sustainable basis, the momentum for now seems to be there. and relief around a potential ceasefire around russia and ukraine seems to be part of the factor, as well as earnings for european stocks breed let's have a quick look at hermes.

hermes at the highest and into of the luxury space has been more resilient. earnings out shortly. we will break those down for you. and we will see with the china story and u.s. and the consumer for hermes. british land lender natwest going to promote some interviews that will come out. will release its earnings in a few minutes. the ceo paul thwaite gives his first tv interview since taking the top job. at 9:30 a.m. meanwhile former french prime minister dominique de villepin will join us in later today francine lacqua moderates a panel from the munich conference on the future of u.s.-ukraine security cooperation with president volodymyr zelenskyy. the opening trade is next. this is bloomberg. ♪ p number® smart bed is perfectfor couples the climate360® smart bed is the only bed that cools and warms on each side

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kriti: good morning, i'm pretty good up, here's what you need to know.