has been limited, such developments naturally feed into tighter bank lending conditions for the real economy to date though some repricing in bank lending is happening wihere the rise in spreads has been more significant, overall bank funding costs remain near historical lows in all large countries thanks to a steady deposit base to protect households and firms from rising rates, high-debt

countries should not increase their debt even further, and all countries should respect the rules of the economic and monetary union other risks stem from the possibility of a disorderly increase in global risk premium. the reaction of asset prices to surprise inflation in other jurisdictions that are at a more advanced stage in the business cycle or the return to the financial deregulation that was the primary cause of the financial crisis, and fragilities in several emerging market economies exposed to currency mismatches are all risks that warrant close monitoring of course then we have brexit where we all wait to see how it

goes so how is the growth picture affecting the outlook for inflation? here we need to assess to what extent wage growth is robust to slowing momentum and to what extent wages will pass through to prices. the link between output growth and wage growth in the euro area has strengthened compared with recent years as the domestic expansion continues, wage pressures have started to build and have surprised on the upside this year annual growth and compensation per employee reached 2.3% in the second quarter this increase is broad based and present across most sectors and euro area economies. two factors suggest wage growth

should be rezil yesilient to a of slower growth the first is that the labor market is already showing tightness, and this should remain the case so long as growth continues at or above potential. labor shortages have become more prominent and widespread across the euro area. broader measures of slack have also fallen substantially, though there is some across countries. the second factor is the changing composition of wage growth the initial pick up in wages fr from 2016 was driven by wage drift which includes components such as bonuses, overtime and tends to react more quickly to the cycle. more recently negotiated wages have strengthened rising from

1.4% in mid 2016 to 2.2% the second quarter of this year. negotiated wage agreements frequently last two or three years, suggesting that higher rates of wage growth are likely to persist however the next leg of the inflation process, namely the pass through of wage growth to prices remains still relatively muted. measures of underlying inflation such as core inflation continue to hover around 1% and have yet to show a convincing upward trend. to some extent this response is in line with the standard pattern of expansions in the euro area. as demand picks up employment initially reacts slowly which boosts overall productivity and margins. firms therefore have little need to increase prices, but as the expansion matures businesses

increase wages more strongly to attract labor and labor costs rise squeezing margins and putting upward pressure on prices now this pattern has been visible in the euro area since the start of 2017. unit labor cost growth fell initially last year but rose this year to reach 1.6% in the second quarter, its strongest rate since the start of 2013 there is evidence that margins are now squeezed with unit profit growth decreasing substantially from 2.7% in the end of last year to 0.7% in the second quarter of this year. we expect pressures to point the speed of this process is state dependant.

preliminary ecb research finds the recent history of inflation is a key factor in the speed and strength of the pass through from wages to prices the pass through is systematically as one should expect the pass through is systematically faster and stronger in periods of high inflation than in periods of low inflation. following several years of this is understandable. but as labor costs rise the room for absorbing costs increase through squeeze will recently vanish as price increases become more widespread and firms become more confident about pricing power we should see a higher degree of pass through and higher inflation

when the governing council met in october, we confirmed our confidence the underlying strength of demand and wages supports our view that the sustained convergence of inflation to our aim will proceed the lag between wages and price of low inflation patience and persistence in monetary policy are still needed with monetary policy providing a significant degree of stimulus through our interest rate policy, acquired assets and investments in maturing bonds the governing council assessed this could be maintained even after a gradual winding down of our net asset purchases. subject to incoming data confirming this assessment we anticipated that net asset

purchases will come to an end in december however the governing council also noted that uncertainty surrounding the medium term outlook have increased when the latest round of projections is available at our next meeting in december, we will be better placed to make a full assessment of the risk to growth and inflation we conveyed that we expect interest rates to remain at their present levels at least through the summer of 2019, and in any case as for as long as necessary to ensure inflation continues to move towards our aim in a sustained manner. we stated that investments will continue for a period of time after the end of the net purchases. in any case and for as long as necessary to maintain favorable

liquidity conditions and an ample degree of monetary accommodation. the nature of this forward guidance is contingent on economic developments, and therefore acts as an automatic stabilizer if financial or liquidity conditions should tighten unduly, or if the inflation outlook should deteriorate, our reaction is well defined this should be reflected in an adjustment in the expected path of future interest rates our forward guidance has been effective in anchoring expectations above the future path of interest rates, and preventing an undue tightening of monetary policy caused by premature expectations of policy normalization. it also helped shield financial conditions in the euro area from policy changes in other

jurisdictions. so in conclusion i just want to emphasize how completing the economic and monetary union has become more urgent over time not less urgent. not only for the economic reasoning that always underpinned my remarks, but also to preserve our european contraction. let me thank the previous two speakers for having remained me that this is my last speech at this conference, as president of the ecb. i wish to thank this audience for the support you always expressed for the action of the ecb during this period of time so what i did yesterday in preparing for this meeting i went back.

i looked back at the speech i gave here in 2011. i lamented that the economic crisis would require a faster pace in strengthening the monetary union especially sfras far as decisio that have already been taken were concerned lots of stuff was decide and not implemented at the time. this must have a familiar ring today. since then the work has been remarkable here i reiterate what has been said before, the completion of the banking union -- i will reiterate for different reasons. the come peegs of the banking union and its different dimensions including risk reduction and the start of the capital markets union through the implementing and ongoing

initiatives by 2019 have now become as urgent as the first steps in 2011 where in the euro area crisis management these actions are urgent today not because of economic crisis we have successfully addressed, but because they are the best response in the economic and financial area to the threats that are being levied at our monetary union we have to react with attention certainly. also with strength, with pride for what we've achieved, and with conviction where we want to go to these threats that can only be one answer, more europe. thank you. >> okay.

that was ecb president mario draghi giving his last ever speech at the european banking congress he was talking about the fact that eurozone economy is going through a temporary soft patch, but that the expansion should continue in coming yearins. he's given a nod to some factors contributing to this, auto production, new emission standards in germany and weaker trade growth on the upside he notes three reasons that the economy is still resilient and still points to very strong wage growth, says that the increase in compensation per employee is broad based, consumer credit is robust and ultimately the conclusion is risks are broadly balanced no change in tone there out of the ecb despite some disappointing data we had of late all right. welcome to "street signs." i'm joumanna bercetche these are your headlines

sterling gains as theresa may says her deal protects the integrity of the united kingdom claiming they will appoint a new brexit secretary within the next few days european equities trade higher as uk stocks regain some brexit losses while ecb president mario draghi says the economic cycle is resilient. the ceo of deutsche bank says europe no longer has banks that can compete on an international level as he emphasizes the need for consolidation. and vivendi says it has no plans to sell down its telecom italia stake amid a bitter battle with the board as they top third quarter sales forecasts sending shares higher. let's check in on how markets are doing.

yesterday tech led the sectors up more than 2% on a heavy week of trading tech along with six other sectors in the u.s. are still technically in correction territory. we got a bit of a mood uplift yesterday overnight in the asian equities trading nikkei up a bit, a bit of weakness but strength in chinese indices as we head into that g20 summit at the end of the month some optimism about trade talks. the mood in europe is more positive stoxx 600 opening up about 0.3% higher after heavy session of trading yesterday. stoxx 600 was down 1% on the day yesterday. so we recouped some of those losses but not all of them let's talk about sectors at the top, basic resources and media leading the charge, up 1.5% on the down side some defensive sectors, real estate down 0.9% utilities struggling, down 0.10%.

banks were trading a bit below the flat line. yesterday was a weak day for the banking sector let's switch and talk about the uk that is where all of the action was yesterday. i want to point to some of the key chips in the ftse 100. what was interesting about yesterday's session is even though it was a heavy equity session for european equities, ftse 100 was the one index that ended the day up in the green. we ended up at 0.6% in yesterday's session. today is another rebound, about a quarter percentage point you can see the picture is mixed. we have the main basic resources, miners, companies rebounding today up 0.6% half a percent rio tinto up the banks staging a recovery but the market continues to punish uk banks with domestic exposure and reward those with international exposure we'll talk more about that let's get to our main story

which is that theresa may has been answering questions from the public on lbc radio amid turmoil in her government. she declined to comment on whether she offered michael gove the role of brexit secretary but said she will appoint a replacement for dominic raab over the next coming days. willem joins us from westminster. the question is who is likely to succeed dominic raab as the next brexit secretary >> i can't answer that for you but it will be someone who can deliver on what theresa may said is the only deal in town dominic raab has been nexting on negotiating on behalf of the uk, and david davis has come out in the past criticizing what he sees as this draft proposal. he signed off back last december on the idea of an irish backstop it seems that would be an

important requirement for the next brexit secretary, someone who believes this approach is the best there is. theresa may did seem relatively relaxed. she acknowledged it was a difficult few days, that she was tired, but she was in command of the facts. she seemed sympathetic to some concerns raised by listeners there are some interesting points to bring up she talked about concessions made by the european side. she wanted to play up the idea that it's not just the uk that has made concessions in these negotiations the europeans she said had come around to their idea of not having any customs border in the irish sea. we have seen a divergence in the backstop details between northern ireland and the rest of the uk, but no customs border. also seeming relatively confidence about her relationship with the dup, but not willing to answer specific questions about whether she thought they would vote with her

conservative party when it comes to a house of commons vote on this withdrawal agreement. one other thing about that vote, that's something we'll watch closely if it happens is the idea of members of her own cabinet have the potential to vote against it. we know from that cabinet meeting that at least a number of her ministers were against details in this proposal two of them resigned the question is when some of those others who are against this proposal, will they be willing to vote against it in the house of parliament. >> thank you thank you for joining us you will be speaking to a guest later on as well in the form of shami cha kshkrabarti

also liam fox at 12:30 central european time. so why wouldn't you take something for the most important part of you... your brain. with an ingredient originally discovered in jellyfish, prevagen has been shown in clinical trials to improve short-term memory. prevagen. healthier brain. better life.

welcome back to "street signs. angela merkel says she is happy a brexit daft has been reached let's go out to annette in

berlin it seems one person is happy the draft has been agreed to, not so much in this country >> yes, i think that's true. i think angela merkel is just hoping this will go through. looking at what happens now in the uk, this is perhaps also a theoretical consideration. she was also yesterday stepping out saying that the worst-case scenario would be a hard brexit and she's hoping for the deal to go through political berlin is kind of paralyzed to put it diplomatically nobody is really speaking about what's happening in the uk you just hear behind the scenes that they look at what's happening in your country with shock and awe. clearly if there is no deal, if there is a vote of mistrust or confidence vote, the future is pretty much unclear. what is clear, thou though is t

business has opted for precautionary planning they are doing contingency planning everywhere. the majority of german corporates according to a new opinion poll is planning for a hard brexit. that's not boding well for the uk economy i would say clearly business decisions which are taken today also in terms of investment planning, they cannot just be reworked all of a sudden once again if the uk will accept a deal or not. i guess what's happening between now and christmas is yushl also for the economic development going forward in the uk when it comes to business decisions by german corporates. we've been hearing from several german corporates they're planning for a hard brexit as i was saying even the small to medium sized enterprises now are probably going down that path so it doesn't bode well, what we're hearing currently out of

berlin, also out of the business associations for the uk. joumanna bercetche, back to you. >> thank you, annette. thank you for the latest from berlin peter oppenheimer from goldman joins me on the show >> hello >> thank you for joining us. >> thank you >> i want to talk about brexit and the repercussions it's having yesterday was an interesting day for equity markets the stoxx 600 was down 1% by the end of the day ftse was up. it was the only index in europe that was trading green everything we hear is that a hard brexit would be the worst-case scenario for the uk european markets are telling you something different. european markets went into a panic mode yesterday what does that tell you about investors nervousness about the brexit deal and not necessarily just in the uk, also outside the uk >> yes

clearly as these events unfold there is a significant uncertainty in terms of the end game that's another degree of uncertainty that investors have to cope with as your speaker said, you know, if it got to a crash out, a very hard brexit, that would have ramifications both for the uk and for europe though what we saw in the markets, i think, is similar to what played out over the course of the period since the brexit vote which is the ftse 100, a global index in europe with 70% of earnings coming from outside of the uk, actually it tends to have a natural edge. the currency, sterling fell yesterday. the ftse did well. if you look at domestic stocks in the uk, they were weak yesterday in line with other markets in europe. >> we'll talk more about that. i want to ask you about something else that came out of goldman. your bear market risk indicator you're saying is elevated now and is indicating high market

risk the current level is consistent historically with zero average returns over the next 12 months. are you calling for a bear market here? >> we are not. our indicator has been at these fairly elevated levels for some time now in the past when it got to these sorts of levels you had the circumstances which have led to a bear market or a correction or a period of low returns. what we've argued is that the conditions underlying that index are not all consistently showing high levels of risk. one of the most important differences this time is the monetary variables that underline this index, inflation, slope of the-year-old cur yieldt flagging the sorts of risks we normally see so our view is we will get low returns over the next year but not a sustained bear market. >> the question when trading is what is priced in. so i guess my question for you is in terms of valuations now in

the u.s., particularly in the tech stocks, growth stocks, are the valuations sufficiently pricing in this risk of lower growth or zero average returns over the next 12 months? what is priced in. >> great question. lots has changed since the correction in the last couple of months if we go back a year, evaluations and equities were high as they were across all financial assets after years of falling bond yields and the effect of qe if we look at the s&p, forward pe has fallen by 11% if you take european markets, the forward pe has fallen by nearly a quarter since the high in early 2015. if we benchmark the way equities have moved against macro variables, we think they've overshot the current slowdown and are implying a much further slowdown in economic activity from here. we think they overshot on the down side. >> in terms of numbers, what

returns do you have pencilled in for next year versus european equities >> we have low returns across all markets as we expect profit growth to slow and valuations no longer to rise so most of our forecasts are implied by single digit earnings growth >> all right peter, stay with us. coming up on the show, another difficult day for uk banks with heavy domestic exposure 'll discuss that after the break. stay with us so while he's proud to have helped put a roof over the heads of hundreds of families, he's most proud of the one he's kept over his own. brand vo: get the most out of your money, whether you're using quickbooks smart invoicing to get paid twice as fast or automatically tracking your mileage. smarter business tools for the world's hardest workers. quickbooks. backing you.

welcome to "street signs. i'm joumanna bercetche these are your headlines >> we are witnessing a temporary soft patch or a more lasting deterioration in the growth outlook. there is certainly no reason why

the expansion in the euro area should abruptly come to an end >> the ceo of deutsche bank says europe no longer has banks that can compete on an international level, as he emphasizes the need for consolidation. vivendi comes out swinging saying it has no plans to sell down its telecom italia stake amid a bitter battle with the board as the french media giant tops third quarter sales forecasts sending shares higher. let's check in on european g seg. t session the stoxx 600 is down.

ftse mib is a story playing in the back drop with budget discussions. we see a bit of a rebound in ftse mib none of these indices have recouped the losses from yesterday. here i'm talking about the european equities i diy ies ind not uk let's talk about some sterling crosses. big move in the pound yesterday. on the day the pound fell 1.6% versus the dollar. that was the biggest one-day decline since october of 2016. very big moves in cable. today a bit of a rebound but still crucially below the 1.28 level when we started off the session yesterday before dominic raab resigned, sterling was up 1.30 we have barely recovered some losses moving on to fixed income, a massive move in gilts. today we're seeing a recoup of some of those gains in the fixed income space putting into context ten-year

yields rallied about 13 basis points that's the most since august of 2016 so we also saw very, very big moves in fixed income space as investors flew to quality, if you want to say, going into gilts and buying up that fixed income market. let's look at how u.s. futures are shaping up slightly in the red. the dow opening up about 30 points weaker. the s&p about 6 points weaker. still in correction mode all eyes on how the nasdaq will perform today. theresa may has said the eu has given in on several areas during brexit talks. speaking to lbc radio she said brussels made concessions on the european court of justice and on the irish border silvia is live in brussels

it's interesting to see that mrs. may is insisting that the europeans have made concessions. i guess the question from here is would the europeans be willing to make any mores given going on back home in this country and whether or not she can get this deal pushed through parliament >> well, that doesn't seem to be the case here in brussels. let me give you the latest the 27 european ambassadors have gathered here to discuss the exit agreement for the first time they are also talking about the future relationship. and i've been told this meeting is set to last for hours there's a lot of detail to go through. this meeting is the first step to prepare for that big summit here on sunday the 25th. we've heard in the last -- let me tell you first that the message here in brussels so far has been that there's no time to negotiate another deal the capitals are actually quite

happy with the agreement on the table, and the negotiators have said that this is the best they can get. let me tell you some reaction we've gathered the president of the european parliament has said this is a good deal, it protects the interest of the 27 donald tusk president of the european council also said this deal secures the vital interest of the 27. so you can see there the 27 remain on the same page. they are actually wanting to proceed with the -- they want to go ahead with this process they are actually willing to move forward with the brexit process. >> silvia, thank you for bringing us the latest from brussels we will be watching reaction from europe as the day progresses let's look at how uk banks are performing today we had some heavy losses for some domestic exposed banks in yesterday's session.

barclays down 8% rbs was hit in yesterday's session. today doesn't appear to be different. today rbs down 2.5%. hsbc, standard charter, santander are trading in the green. i'm happy to say i got a bank specialist with me, a senior analyst from axiom alternative investments joins us, and peter oppenheimer from goldman sachs is still with us let's talk about some of that divergence that emerged yesterday. investors going straight to reward banks with international exposure punishing banks with domestic exposure. seems like some of the moves may have been overdone >> indeed. the key to read this under-performance is probably in fx and the exposure of those banks to the weakness of

sterling rbs, lloyds as well as the insurance sector, the stocks that are the most correlated to sterling weakness. what we've seen yesterday we saw as a strong performance from hsbc and standard chartered, who were up 2% on the day. so that's probably the key to understand this move the banks are actually indirectly impacted by the brexit with all elements they were barely mentioned in the 585-page document, and they are feeling the pinch on the rates expectations whereby the outlook for earnings is definitely lower, as well some potential stress on gdp and sentiment that could impact asset quality. >> peter, i want to ask you, are you seeing a big valuation gap in the uk between domestic and

international exposed stocks >> yes, we have seen that. as we were discussing earlier, domestic stocks have born the brunt of the weakness following the brexit decision. they tended to be weaker and that's really where we've seen the weakness every time that risks have increased. they are looking cheap on a relative basis compared to history. the discount versus the rest of europe or the u.s. is as big as we've seen for a long time there's value there, clearly a high risk premium because this is an area most exposed should we get to a situation where there's a harder brexit. >> i want to ask you about rbs we had big moves in that bank yesterday. there were some murmurs about the "n" word, the nationalization, if we do get a change in leadership, change in government, labor government coming in. can we talk about that, your take on the rbs performance

yesterday? >> yes labor has suggested that recenthaven' eventually they would look to change the bank into market players. you have a number of steps to happen in the parliamentary geometry we think this is a remote risk and a drop of 10% is definitely a significant thing. if you put that in context of the recent performance of the stock for the past six weeks or two months it's actually also a correction on this performance >> i spoke with sir howard davies earlier in the week, he said the worse is over for rbs they resumed paying their dividend, the first time in ten years. quick last question for you, do you think this divergence between international banks and domestic banks will continue

until the formal brexit march if it does happen at this point >> until high incentives impact the volatility of those domestic banks. to be fair, lloyds in particular, rbs as well, they have done a lot to build capital, they've done a lot to strengthen asset quality and they've done a lot to initiate capital return with investors. so investors are still waiting to see value and probably these times we'll see this >> thank you for joining us on the show >> thank you peter, thank you very much for joining me the last half hour as well in some corporate news, vivendi remains committed to telecom italia, that's according to the ceo who rejected suggestions that the firm would

sell its 24% stake in the italian firm telecom italia fired amos gennis earlier this week as the french media group beat third quarter forecasts. the announcement was made in an analyst call after announcing a beat in the third quarter sales. third quarter revenue at bollore has grown 8.8% amid a solid performance from the oil and transportation divisions rovio the maker of angry birds reported an increase in third quarter operating profit sending shares higher, up more than 10% it warned full-year sales will be hit by falling player numbers and tougher competition. the ceo told investors it's clear we need new games to accelerate growth.

abb is in talks with regard to the sale of its power grids business the swiss company held negotiations with hitachi, mitsubishi and state grid of china to sell all or part of the struggling unit. a deal could be valued at 11 billion and may be announced as early as next week abb declined to comment on the report when asked by cnbc. coming up after the break, former u.s. treasury secretary larry summers says brexit is not a top risk as long as it's orderly. more from my interview coming up next plaque psoriasis can be relentless. tremfya® is for adults with moderate to severe plaque psoriasis. with tremfya®, you can get clearer. and stay clearer. in fact, most patients who saw 90% clearer skin at 28 weeks stayed clearer through 48 weeks. tremfya® works better than humira® at providing clearer skin, and more patients were symptom free with tremfya®. tremfya® may lower your ability to fight infections and may increase your risk of infections.

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we just had confirmation or reports that michael gove will remain as environment minister in prime minister may's government this is reported by "the times." there was a lot of speculation as to whether or not he would accept a job as brexit secretary or even resign given his brexiteer stance, but now we know we have confirmation he will remain in his position,

remain in cabinet. we're seeing a bit of a spike on the pound on the back of that news well, a timely brexit is not a top systemic risk, that's according to larry somers. i spoke to the former u.s. treasury secretary and i asked him about contagion effects. >> if in some way it happens suddenly, then there could be real risks i think if it were to evolve over some time in that direction, i think people would have a long time to prepare. there are all kinds of reasons to think britain shouldn't crash out of the eu. i think it would be costly for britain. it would be costly for the eu. that would not rank high on my list of systemic financial risks. >> talking about europe, the ecb has signaled they would be willing to start hiking interest rates by the end of 2019 do you think that's likely to

happen given some political headwinds and economic headwinds we're beginning to see in europe >> i would be much more surprised if interest rates were raised more than the markets expect in europe than i would be if interest rates are raised less than the markets expect in europe even more i would be surprised if the ecb found itself raising rates faster than it's currently hoping to. i wouldn't be terribly surprised if they found themselves running into circumstances that caused them to raise rates slower than they were currently projecting >> i also spoke to the mp for one of londoncal boroughs >> it's a long agreement, almost 700 pages here i got it in my hand. i'm wading my way through. ultimately the uk and the eu

will come to a deal, it's strongly in both sides interests to do so i think everybody is expecting the route to be rocky in how we get there. i think the deal as it currently stands is not likely to past through the uk parliament. it will be rejected by the house of commons that's one of the reasons for all these resignations i think the eu will have to go away and improve the offer if it is to pass through the uk phous of commons >> are you confident that the uk will showroom for maneuver when it comes to the summit announced for november 25 snth >> i think it should i think brussels pushed the uk too far into position where this draft agreement is likely to be rejected by the house of commons. i don't think that will benefit anybody. it's strongly on both sides to come to an agreement, both the eu and uk. overnight the uk becomes the eu's almost largest external

trading partner just behind the u.s. incredibly important, the uk imports a huge amount from the eu defense, security cooperation, anti-terrorism, all of these things will be put at risk i think the eu will have to go back and reconsider its offer. >> you're an mp for one of the wealthiest boroughs in london. are people moving out, moving away, activity slowing down because of brexit concerns >> rather the opposite the london economy i think is doing well there's more eu nationals today in the uk than there were at the time of the brexit vote. the uk economy is growing strongly the latest figures, quarterly figures show the uk growing more strongly than germany, france or italy. i think the uk economy is in a good position. foreign investment continues to come in. i think investors have confidence in britain as being

an open economy, open for investors, a good place to invest >> that was greg hands i want to reiterate we're seeing a bounce in the pound here the sterling is up 0.2%. this is on reports in "the times" that michael gove is going to remain as environment minister in the prime minister's government there was a bit of speculation that he may be looking to resign he obviously has not according to this report and he will be a member of the cabinet. willem joins us from westminster. i don't know if you were listening to the greg hand interview there, i thought it was interesting that he said it is unlikely the deal will get through parliament at this point in time. and in order for it to get through, they would need to see further concessions or some concessions out of the eu, particularly when it comes to irish backstop and the uk having the ability to withdraw from that backstop.

>> yes that's something that a lot of members of parliament and indeed even some ex-ministers are in favor of a hard brexit have been saying they expect david davis and the european side would suddenly change their position on all of this and, you know, if you talk to european officials about that kind of issue they say absolutely not going to happen i suspect there may be unnecessary optimism there about potential concessions down the road from the european side. this parliamentary vote when it happens on the 25th of november will be the crucial test for this proposal. what's unclear at this statement, certainly theresa may not giving us details about what would happen if that is defeated she was talking to a british radio station a while ago this morning and talking about the desire to encourage members of opposition parties to vote in favor of this, not just members of her own conservative party.

many of whom said they disagree with some details in this. a lot of unanswered questions about her support in the cabinet going forward, support within her own party and support within the parliament here. what she's been at pains to declare this morning is that the europeans have already made concessions. the chances of there being further ones in the future seem remote >> one other risk before that november 25th summit is that of a leadership challenge we heardfrom jacob reese mogg yesterday calling for a leadership challenge how likely is that to happen in coming days if it does actually happen >> i think that's the key issue to be focused on over the next 24, 48, 72 hours is whether you end up with all 48 required letters going into the 1922 committee, the body inside the conservative party's parliamentary ranks that decides

on leadership challenges if the chairman of that committee, graham brady, receives all 48 letters from enough conservative mps who seem unhappy with the direction of theresa may, he could call for a leadership challenge that could happen today, but that's something to watch very, very closely. >> we will watch that closely. also we'll look forward to your interview later with labor mp shami cha kshkrabarti before we leave, let's recap some of the activity we've seen over the last 24 hours today it looks like equities will open up slightly in the red. this after a rebound that we saw in u.s. markets yesterday, rallying off some of their lows.

the tech sector had a good day yesterday, but crucially on the week tech along with six other sectors in the u.s. are in correction territory i want to look quickly at ftse 100, because we have been watching that closely. it is another day where the ftse is trading indeed up in the green, not as high as we were about an hour ago. again, that inverse correlation with the pound continues to be at play here we did see the pound spike a bit on news that michael gove is staying in the cabinet that is the picture for european markets and u.s. equities. that's it for today's show i'm joumanna bercetche "worldwide exchange" is coming up next.

wall street pointing to a lower open after the s&p 500 snaps a five-day losing streak pounded. sterling stabilizing as pressure mounts on theresa may and her brexit deal. we're live in london with the latest. and firing back. sheryl sandberg responding to a bombshell report that facebook ignored russia's role in the 2016 election. it is friday, november 16, 2018. you are watching "worldwide exchange" on cnbc.