wild ride on wall street but asian stocks seem to have weathered that ride. the question is whether european stocks can hold up given the escalating fears around trade tensions we may see a list tallied up before christmas if there's no break through with china markets are focused on that in addition to the volatility, the

earnings, the trade side, economics in both countries and across the globe heightened fears on wall street. the stoxx 600 just nudging into positive territory a modest tick higher, 0.20%. let's look at some of the sectors. oil and gas at the top household goods at the bottom. reckitt benckiser reporting today. that stock dropped and it is leading the basket banks just below the flat line, trade and leisure, too from there we are pushing higher a big mover could be volkswagen on the back of numbers that beat expectations so far we don't have a symbol there. but the autos are up retail stocks bouncing about a

third of a percent industrials are trading higher the nasdaq was the underperformer down more than the likes of the dow technology caught action in the early trade moving into the green. the two sectors where you see the most appetite, basic resources and energy space cyclical trade, 0.6% higher on basic resources. oil and gas moving higher by 1%. bhp at the top of the basket, it is reporting blowout numbers today. that's moving the needle on that stock. the ftse moved higher off that base with 21 points adding on to the index. not a bad day yesterday lifting the uk market off of some of its lows we saw a rally of 1.25%. we are backing up on the gains the french market got about a third of a percent attached to it we're looking for the opening of the german market this

morning. yesterday was 1.2% north for the dax. switching over, the ibex in spain, up about 0.4% better signals on the italian market the smi is up 0.30% north. as these markets are trying to shrug off some of that wall street action from yesterday let's look at bp, underredespit strength earlier in the quarter, crude markets are on track for their worst month in two years the bp ceo said he expected further volatility ahead >> i don't think these

geopolitical moments like sanctions or i'll taoil taken o market would have the same effect, with oil stocks below the five-year average, you will see more volatility. so you might see plus or minus $5, or plus or minus $10 a barrel and you have supply shocks >> the bp stock price busting out at the early signals we've been up 4%, so strong reaction is what we're seeing. that has impacted the three-month performance. we had a dip as the trade fears, economic fears also impacted the oil bid and that reversal in the spot price meant energy stocks suffered the stock now with gains today still down but to the tune of 2% let's get to volkswagen. we were expecting a 3%, 4% pop in shares 4.

. 4.2% to the upside. there are issues from continually challenging market conditions speaking to cnbc earlier the ceo said the carmaker faces headwinds from global trade tensions >> nervousness in the market is a reflection in the discussion some people call it a war on trade terms between the united states, europe and china i think it's important we come back to the negotiation table, that we find mutually acceptable solutions. but it is a difficult situation, all those rumors and speculations are making it hard on investors to stay focused in our industry i think we still believe that all parties are very clear about the consequences of rising tariffs, and therefore it is important that we come to equal and fair solutions >> bhp paribas stock slides

1.2% it has reported a miss on third quarter revenues citing weaker performance in investment banking and corporate units, however they posted a beat in profit thanks to the international services division. let's get out to joumanna for more from paris. if you take a longer picture of the stock price it has been falling for a couple years i know emanuel macron was elected to power and there was a hope that banks would get a bid, a pop. it hasn't lasted long. >> i think that's the question investors are asking they clearly wanted to see something new coming out of bnp paribas to draw on your point. the stock is down more than 20% year to date in line with european financials as a whole let's drill into today's numbers. they missed on revenue that came in 0.4% lower

year-on-year operating expenses were up 2%. that raises questions about revenue growth versus expenses growth a bit of a beat on the bottom line, up 0.4% year-on-year as you mentioned, if you drill into details, it looks like a low quality beat one thing i want to talk about specifically, you mentioned the retail banking side which has not seen love in the last 12 months, namely because of the low interest rate environment and subdued momentum in the french economy i also want to talk about investment banking we know this is one of the first french banks to start reporting. we know they have an equity derivative exposure. all eyes are on bnp to see what numbers they come out with today. on the market side, down 8% year-on-year equities were up 5%, but crucially i would say less of a performance versus u.s. counterparts where on average

the businesses were up 8% on the equity side of things. now i had the chance to sit down with the bnp cfo yesterday, we talked about a bunch of things one thing i did ask was about the recent volatility in the stock market of course it has been volatile the last couple of weeks while it doesn't technically fall into q3, i asked whether or not it boded well for q4 let's listen >> it's a bit too early to say we're not a forward guiding bank if we give guidance now we might have to evolve that. if you look at the third quarter, what you saw in the equity business, the equity business was up. that's where we basically saw already in the third quarter we saw a pick up in the equity activities which grew by more than 4%. so that is basically paving the road for what we'll see in the fourth quarter >> a couple other phenomenon have also happened the first is a big sovereign spread widening in italy can you talk me through some

exposure you have there? >> in italy we do have a presence, but let's be fair the market share we have you can count it on the fingers of one hand on top of that we have repositioned our activity to be focused on the core clients we have at bnp paribas. so that means 9 cothe corporates which are internationally exposed. so we basically fund ourselves by our activities. so for us we don't compensate our balance sheet with bonds and whatever it's equal and there is no major exposure at risk >> markets businesses are continually under pressure here, down 8%. they already announced cuts in the investment banking side a few weeks ago. the outlook looks more positive from the equities perspective given that was the one bright spot of q3 lots of questions going into q4.

i want to dra quiw quickly on s macro developments bnp paribas has exposure to turkey about 2% of overall revenues given the big depreciation in the lira, they did book in a 60 million hit from the turkish lira impact on the currency. and their exposure to italy, you can count it on one hand, but it's something people are watching out for particularly because they have an international retail banking exposure, it is not just french retail so a lot of questions and putting it together, not surprised the stock was down it was a low quality beat on the bottom line and investors will want to see more, not just on the capital accretion side, they will want to see more of a return on equity on all sides of the business >> joumanna, thank you for that closeup on bnp paribas >> let's look as more. reckitt benckiser has been out with numbers today seen down about 3% to 5% it is right up there in terms of losses on the stock price. 4.5% south

a temporary disruption at a baby formula factory in europe weighed on sales growth. they reported a 2% rise in like for like sales, that's below forecast >> henry dixon is an asset manager and is our guest host this morning do reckitt benckiser deserve to get down side of 5% this morning? >> i think it's a big miss on reckitt, and that points to supply issues. if you normally the supply issues, it is still a top line miss that's clearly not priced for that kind of top line miss

clearly multiples will come under pressure today >> there used to be a time when the ceo walked on water. he could do no wrong now my question is, it was almost a parallel from a sorrell and wpp, they could do no wrong at the peak of their powers. how different is reckitt benckiser today? it's the same business you're selling product to amazon, the supermarkets, to retail, across the board it's the same thing. it hasn't changed. why is the business so different today and tough compared to that glory day? >> i would say -- we are caught up in the whole sort of undermining of the brand there is now a route to market we have never seen before. a supermarket company, which i won't name,convened a meeting with the company along the lines

of reckitt benckiser, and they pointed to the shelf and they saw a branded good to that company which was sold to customers for 1 pound. they're saying are you telling me the way we have to sort our goods is to go somewhere else and buy it cheaper than from you? there's certain areas that have been blood floflooded with good that's happening at a time where we have accelerated route to markets from new entrants. i think it's a difficult period of time and clearly with a multiple like reckitt benckiser in the 20s there's no room to miss >> i want to ask you about sectors. retail, household goods, none seem to be protected at this point. where do you want to be positioned in this market that

has been beaten up is there value in some of these so-called safe areas of the market >> i think there's fears about the cycle and they are quite strong maybe you maybe can last past year-one multiples and towards longer-term values we like to look at as much history as we can, at least ten years worth of data on ebita, sales, margins, we're wrestling with the notions of peak margins here as we look at long-run valuations, we think it's about 15% of the market that you could buy here today that i think stands the test of time over the last few years with regards to valuation in mind. that's where we want to be spending our money >> that's not much >> clearly as active managers we only need to pick 60, 70 stocks in the yuuniverse of several

hundred, but you need to be that selective. a lot of companies are cheap based on earnings, but you have to be careful about the margins. that's the bit of work we're most keen to doing valuation has been walked up we have to remind ourselves where valuations were at the start of 2012, where valuations were in the start of 2009 and not lose sight of the fact that that is a potential range of outcomes where valuations may end this period. >> i thought it was fascinating you wanted to talk interest rates with our man from ey here, perhaps that gives us a sense of where your head is as we think about the macro challenges the interesting thing is there was a relative game going on when you recognized the mismatch between the u.s. valuations and the rest of the world and you thought maybe the rest of the world will come up to where the u.s. is what we've seen over the last two weeks is the u.s. is coming down to where the rest of the world is does that make it much more challenging then to pursue that

relative valuation story because that opportunity or that gap narrowed >> i agree i think that's right sitting in the uk, we have a relative value gap clearly we want to close up. where you got to be careful is valuations we could have the u.s. falling and meeting what could be good value elsewhere in the world. that comes back to my earlier conversation with can you put together a portfolio that can stand the test of time for a ten-year point of view if you can, the odds are stacked in your favor, but it's not guaranteed that's our approach we want to take with regards to valuation it's not cheap just to the u.s. or to bonds, we want to go for a much more absolute approach with valuations that stand the test of time. >> let's go back and find out

what you are watching over there. >> you would be tempting to think we would play catch up to wall street today and be back in the red, that's not happening in the charts it seems like the u.s. market is diverging again to the down side we're not seeing the selling in the european markets or in asia today. one stock that is on the move today, the third worst performer on the stoxx 600, lufthansa down 5% after third quarter adjusted earnings below forecasts thanks to higher fuel prices, and extra delays and cancellations they expect to raise capacity at a slower rate than peers this winter, an 8% number versus 10% for competitors. to the banks and the spanish lending, bbva posted a third quarter net profit in line with forecasts as its capital gains in chile and strong performance

at the mexican business helped offset pressure on the lending income the lender saw net interest income come in at more than 4 billion euros ahead of forecasts. high market volatility and a rise in u.s. rates helped boost third quarter net profits at deutsche boerse. revenues jumped compared to last year the firm confirmed its full-year profit growth target along with numbers today. coming up, uk chancellor philip hammond announces his end of austerity budget with one caveat find out more after the break. today is the day you're going to get motivated... get stronger... get closer. start listening today to the world's largest selection of audiobooks on audible. and now, get more. for just $14.95 a month,

you'll get a credit a month good for any audiobook, plus two audible originals exclusive titles you can't find anywhere else. if you don't like a book, you can exchange it any time, no questions asked. automatically roll your credits over to the next month if you don't use them. with the free audible app, you can listen anytime, and anywhere. plus for the first time ever, you'll get access to exclusive fitness programs a $95 value free with membership. start a 30-day trial today and your first audiobook is free. cancel anytime and your books are yours to keep forever. audible. the most inspiring minds. the most compelling stories. text "listen8" to 500500 to start your free trial today.

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firms. the official economic growth forecast for 2019 was raised gdp is now expected to grow 1.6% next year. mr. hammond warned that things could change if a brexit deal was not reached. >> we're at a pivotal moment in our eu negotiations and the stakes could not be higher get it right and we will not only protect britain's jobs, businesses and prosperity, but we will also harvest a double deal dividend. a boost from the end of uncertainty and a boost from releasing some of the fiscal head room that i am holding in reserve at the moment. if the economic or fiscal outlook changes materially, i will take whatever action is appropriate if necessary upgrading the spring statement to a full fiscal event >> jeremy corbyn disputed mr. hammond's statement. >> the reality is whatever the

chancellor claims today austerity is not over. and far from building a strong economy, eight years of austerity has damaged our economy, delayed and weak ed the recovery and endlessly postponed fixing the deficit unnecessary austerity has caused real hardship to millions of our fellow citizens. held down living standards for the majority and failed on its own terms. the british government says it will sell all of its shares in rbs by 2024 the government owned 62.4% of the british bank which it rescued in 2008. the british taxpayer is expected to make a 28.5 billion pound loss on the sale looking at william hill, they're trading higher after the chancellor delayed cutting

stakes on fixed odding betting terminals. pad yi pou paddy power betfair is trading lower. couple thoughts on the budget? whatever jeremy corbyn says here, this is still the highest level of taxation on the british public in 30 years, so so much for austerity. >> government spending now is growing in real terms. that hasn't happened in ten years. that's an important thing in general. then if you combine that also with rages growing, if you think about two key things for the economy being government is, and consumers, hopefully that's slightly better. and business invest mement and o knows if we get the line in the sand for brexit, where business

investment can come back to where you might expect it to be at this cycle. >> this lifts the skirt on how terrified this government is, doesn't it this was a budget -- i've listen looking at budgets for the last three decades professionally in one way or another, and this was a budget you only normally get in the last year of a parliament, ie just before a general election we're not due a general election until 2022 this was a giveaway spending budget dare i say it, all the points for the uk economy may be moving in the right direction, in terms of politics i think it shows how worried mrs. may is. >> couldn't agree more this is a chancellor who feels his time is running out a bit as well. may, no doubt, is under quite a bit of pressure. so i don't deny any shape or form this is a general confidence trick >> this goes with everything we've been talking about, brexit

concerns, and whether or not there could be a leadership change, the tories are still in turmoil. what do you do with a portfolio at this point? we are approaching a window where brexit could have an impact on investments again. >> we get asked that question a huge amount. we're rules based and the best thing we can do is stick to the investment rules we've been using, which are not impervious to this, but what we've seen with regard to price action, currency moves is broadly speaking now we've seen what happened over brexit in june of '16 unfolded in the last six months in a low moti slow motio. i'm not saying there won't be

price action in the market that won't be uncomfortable but it won't be the magnitude we saw. i think trade has created better valuation opportunities overseas rather than necessarily going to do mdomestically >> let's take a break. there's a race now to succeed angela merkel. we will talk more about who is set up and best placed to replace the german cnclor haelas she steps down from her cdu position hard work baby, it gonna pay off. get stronger... get closer.

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bp jumping to the top of the stoxx 600 after profit doubles to 3$3.8 billion in the third quarter driven by higher oil prices and increased production levels. oil prices are more prone to higher volatility off the back of geopolitics or any supply or demand shocks that we see going forward. they got a bit ahead of themselves in our view through the quarter as we got up over $80 a barrel they softened but still look

constructive. volkswagen opening higher after the carmaker beat sales expectations despite ongoing trade fears. the cfo tells cnbc the company is wary that escalation may hurt investor sentiment >> nervousness in the market, trade terms between the united states and china are making it hard on investors to stay focused in our industry. bnp paribas in the red after investment banking weighs on the better performance at the french lender's international business in the third quarter >> this lackluster environment in some activities but it also shows the bank is optimizing resources. and fuel costs are dragging on lufthansa which misses third quarter profit estimates as the german carrier raises capacity by a smaller margin than

expected this sent the shares lower. stocks in europe have been trading for a half hour. we have a bounce across european markets despite the fact that wall street traded lower the dow was down 1%, and most markets here are bouncing in the green. the ftse mib is up about 0.7%. if you look at a day earlier as well, we had a gain across europe we have markets holding up, weathering some of that volatility despite wall street moving south the stoxx 600 is up 0.1% the benchmark in the green as we move throughout the session. trade tensions in the back drop. wall street dropped on the back of concerns that there could be fresh tariffs on chinese goods

as president trump was drawing up a list of a breakout of midterms so investors are nervous about that let's get into the trade a lot of earnings are driving the sectors and stocks today oil and gas in particular, bp a big reporter in that basket. autos going north. volkswagen is a heavyweight in that basket and driving the sector forward to the down side, the underperformers, construction, industrials, travel and leisure. wh smith is one stock we have not spoken about 6.7% higher. this is actually after deal making this is a modern day news agency it has now taken a step into the u.s. airports market it's made a key acquisition of 155 million pounds shares have been trading higher.

volkswagen and bp both on the back of beats. the stock prices of both are moving north here's a line from the likes of bp one of the copy pieces saying bp thundered to a profit telling you how strong the numbers have been 3.9% higher in the share price volkswagen saying third quarter net profit also rose despite the headwinds we're talking about. trade, the pivot towards emissions testing and electric vehicles moving higher reckitt benckiser is a disappointing stock as it posted numbers. it's down 4.6% >> wilfred frost is in the house. he and i will be shooting the breeze in 35 minutes time. if you want to watch that. "worldwide exchange" at the top of the hour. the time has come to open a new chapter. that's the message from the german chancellor -- part of a new chapter. that's the message from the german chancellor angela merkel who announced she will be stepping down as chair of the

cdu party. adding her fourth term will be her last the decision to call an end to her 13-year reign comes after her party performed badly in a second successive election the race now for a cdu leader has officially begun i know i have the same problem, at least viewers are getting a different take from you, my problem remains she's telling us there's a new chapter coming but she still wants us to read her book at the same time. >> that's kind of true i think what she's planning is a gradual retreat from german politics she wants to have a smooth transitionary period whether this is possible in german politics or not remains to be seen there's already so much in-fighting going on in her own party that i think it's a very risky approach, the approach she has taken. to be fair, she also said that

and she admitted that it has a lot of risks what she's doing now. she thinks that's the right way. she admitted that she already made her mind up before the summer break to actually not run again as the leader of the christian democratic party, and that came after all this infighting with the man who almost brought the coalition to a halt and so many problems inside the grand coalition made her think that it's time to open a new chapter. it's time to at least partially step aside whether she can last the remainder of her term remains to be seen. that depends on who will be the new leader and whether she can work with that person closely together if this is going to be an adversary, she probably has to step aside earlier than she

initially wanted stepping aside is not that easy in german politics you need to have a vote of trust in parliament, you need to have a successor in place it's not just that you can throw the towel in and say i'm done with it. so we'll probably see an orderly process of transition and we always have to have new elections. talking about new elections, that's the key point here. nobody in political berlin from the big parties has a huge interest in new elections because both big parties, the spd and the cdu have seen ratings plunge by 10% and more so new elections would not bode well for anybody in the political berlin, for anybody in that government currently. that's why most of them will

pull it together and say we would rather stick to it and we work on convincing the voters that we have something to offer to them. what we've seen here since, i think, 2015, since the refugee crisis is a clear fragmentation of german society, now with the advent of the greens, the surge in their popularity, it's clear the modern germany, the open society germany is supporting them and then we have the populist parties but they seem to have seen sort of a stagnation. they are not rising above certain levels so there is a potential here it is a revolution for germany, for political germany what we're seeing currently and it is a process which is just unfolding so it remains interesting here, the political story in berlin. back to you. >> i will make it my anything to learn about german parliamentary rules. i find it incredible what you're

saying, that the country has decided -- thank you, annette. the country decided that merkel's time has come she had an amazing run. yet we got this process where we have a two-year handover it's not queen beatrice of the netherlands, you can go and let someone else have the job. >> it's a rules-based system, steve does that surprise you >> no, it doesn't. >> if any country would have it, it would be germany. >> there is a mechanism for early -- there are mechanisms where you can call confidence votes and circumvent that. as you say, it's a rules-based society. >> you have an exciting 48 hours ahead of you >> i'll have to put aside my reading of nixon at the moment bp third quarter profit hit

a five-year high underlying profit was more than double the year-ago period. i think this is not fair on the back of higher oil prices, i think they done a lot of other stuff which is benefitting from that and turning around this company, i don't just think it's higher oil prices crude markets are on track for the worst month in over two years. the cfo told us he expects further volatility ahead >> if this was five years ago and oil price stocks were at the top end, beyond five-year averages, i don't think these geopolitical issues like sanctions would see us move like

this simon fwshgervin joins us now. there are times i'm digging through the weeds on a report, i have the bp one here it's 35 pages long i didn't have to do that this time i saw the headline figure, that was almost enough for me is it that simple this time around it's an old-fashioned beat >> the interesting thing is cash flow is improving. so 7.3 billion pounds of underlying cash flow which is easily enough to cover capital expenditure and dividends. it shows the industry and the companies have come through from two, three years ago where people were struggling to cover dividends. production is grows nicely they generated 6.8% underlying production growth which is quite encouraging. >> sustainability of that cash flow picture is something that all of the ceos of this industry have been working hard to

achieve and cover the dividends and capex. tell me about the sustainability of that cash flow going forward. >> they have taken the capital expenditure right down they have managed to sustain the business to generate growth and maintaining production at a significant lower level of capital expenditure with greater efficiency in the way they run the whole business >> it seems we have opened up value gaps, you are exploiting that, have you been looking at the uk and other areas to invest >> the valuation stocks i think are depressed over concerns over brexit, but even the international companies in the uk are cheap compared to many peers. >> a lot of big name companies have done acquisitions lately. bp is no exception with the

purchase of bhp's oil business in the permian bhp could not do much despite the fact that there were good times in the permian oil prices were low. now the permian looks like more difficult times as they look at costs. >> i think you have to look at where they are on the ground there's overlap between assets and bhp assets what is nice about this deal t makes sense for both sides it makes a lot of sense to have greater scale in the area, it's an asset that bhp couldn't exploit as efficiently as bp can. we have also seen today that bp has said they would probably finance that without issuing new equity >> just to come back to henry's point here, just to reflect on the challenge the chancellor has had because he doesn't know how brexit will go, but he's hedging his bet. i get the sense that a lot of

fund managers at the moment are having to do the same thing. so they are hunting out foreign currency earners that are benefiting from some weakness around sterling as a way of providing some bulletproofing of the portfolio. is there anything else you can do beyond that at this stage to give yourself a little bit of extra pet? clearly the ftse headline performance is not great, even as some of these overseas earners are doing better >> even within the domestics there are companies that have strong asset value if you look at real estate investment companies, those are trading at 30%, 40% discount to asset value. even in the difficult brexit environment, an environment where perhaps sterling might weaken those shares could do well as investors come in from overseas >> isn't that the issue coming back to your point, henry, people are worried about the cost of capital rising again and the impact that's likely to have on all interest rate sensitive

sectors. property is one of those sectors. >> yeah, absolutely. it's always -- if i think about the market this year there are two stages to the setback. the first quarter was cost to capital shock and the second and third quarter is more growth scare. we saw the taper tantrum of 2013, the deratde-rating globaly happened if you look at that precedent, the q1 and valuations, it's similar to that episode. you will never know if it's definitively passed but i think it's well understood now >> i think actually if you look at the interest rate sensitive companies, some of them have performed extremely well, such as the consumer staples sectors, the defensive companies have been put on high ratings but actually many of them like utilities, like real estate companies and telecoms have

performed poorly the market has differentiated between those. as expectations go up, those two areas might behave differently one section starts on low valuations >> simon, thank you very much for that ahead on the show, we saw a 900-point swing on the dow, it was a wild ride as tensions resurface. my mom washes the dishes... ...before she puts them in the dishwasher. so what does the dishwasher do? cascade platinum does the work for you, prewashing and removing stuck-on foods, the first time. wow, that's clean! cascade platinum.

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let's get back to simon who is the chief investment officer from allianz global investors. i'm looking through some of your holdings as well glaxo is prominent again i think they're turning into another controversial stock in some ways. very, very high dividend at the moment i think it dipped below 6% now

it's 5.2% dividend yield a lot of open that emma can turn this company around. you believe she can what does she need to do is yield a key component for holding this stock >> yield is never a reason to buy stock, but we look to buy high-yielding shares but they are repositioning away from big drugs like advair which is quickly declining, and going into new drugs like the hiv drug and the shingles vaccine >> is there not an offering on the market which is a transformed version of what glaxo is wanting to be >> i think gsk is cheap because of the collection of businesses which are underappreciated i think the vaccines business is high quality and would be valuable if you look at unilever, the valuations they trade on is hidden within the gsk business

and they're probably going to sell hallex soon >> so you can turn a 13 times forward pharmaceutical company into a 19 times to 21 times consumer staples company if you get the right mix? >> part of the business is worth more than 13 times pharma business but hopefully they can turn around the pharma business as well they're taking steps to do that. you are seeing in respiratory new drugs coming through fast. >> i think we've seen two large big deals, glaxo and vodafone. glaxo has improved its cash flow, but you look at vodafone, you have seen the differe different fortunes there we didn't get the earnings downgrades, we didn't get

disappointing cash flow. it does look cheaper >> do you own glaxo? >> i do. >> relative performance to the rest of its peers in the uk has been extraordinary what does that tell us about the investment appetite for healthcare at this point >> all the pharma stocks in the uk have performed well this year they have had a run for different reasons. you had a takeover for shire gsk is a much more broader portfolio, a much more tra dilg traditional pharma company it's performing well because people are starting to see cash flow is coming through now and the business is starting to deliver. it will be volatile. we have results tomorrow, there's different bits of it which are moving in slightly different directions >> can we go to basic resources?

it's been a long time since we spoke about that part of the market september was weak month for a lot of these stocks. do you think there's upside before year-end that could take us off the lows of 2018? >> it's hard to call resource stocks in the short-term because they move with commodity prices. you have to look at a long-term view of where the commodities you think might go i'm interested in copper mining. long-term there's not much new copper coming to the market. >> you can trade the ranges on copper copper prices spike on the back of some of the stocks in the basket, which is effectively what happened this year. >> it's not my style to try to trade the ranges i'm taking a longer term view and looking through that clearly you can take advantage if the market gets pessimistic or overly optimistic >> do you think the market is overly pessimistic because of the trade issues we've been talking about, china, huge question marks about whether they can manage the slowdown, is

there too much pessimism now because the commodity store is over >> there is a bit of pessimism in the market. >> we were discussing earlier the valuation gap that the uk represents to the rest of the world here just talking about how actually down the smaller cap scale you had better performance since the brexit vote than you had in large cap. you see any reason to play that opportunity? how do you feel about that part of the market? >> well, it's very difficult to generalize about small caps. we would observe, i guess, within seshgts, ctors, like hou building, very cheap but you look at persimmon trading 100, you can find five, six times market cap scale the only thing you have to be

careful with with regards to spla small cap investing is the flow cap picture. you are starting to see one or two bumps in the road. you have to be conscious of that if you look at the top half of aim, that's collection of shares trading at 30 times earnings so you have to be very, very clear what particular valuations you're trying to isolate i wouldn't want to generalize in aggregate. >> we have some german data crossing let's see whether that helps the narrative. some of the stock markets not holding up as well as they did at the start of the session. the october seasonally adjusted jobless change, minus 12,000 jobless rate is unchanged at 5.2% so we are seeing some movement on the job front interms of what you got on the stock market, i want to make the point we have come back on the

french and german stock markets in negative territory now despite a positive start so we are picking up on some of that uncertainty from wall street want to add, i've been doing some work as well on former german chancellors, willie brent was almost outed, he stayed by two votes. henry schmidt was booted out in 1982, not unprecedented in germany to see these confidence volt votes. >> we'll say good-bye on that point. simon, nice to see you thank you very much for joining us henry dixon our guest host thank you for coming in. was the program thanks for watching he we' we'll see you again tomorrow selection of audiobooks on audible. and now, get more. for just $14.95 a month, you'll get a credit a month good for any audiobook,

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it's 5:00 a.m. on wall street 9:00 a.m. in london. buckle up for another wild ride. futures pointing to a big jump at the open after the dow saw a 918-point swing in yesterday's session. more tariffs coming. president trump turning up the heat on china. full details on that to come. the countdown is on. one week away from the midterm elections. how do you position your portfolio ahead of the big vote. mondelez beats on earnings. an