welcoming to "street signs." european markets are searching for direction as trade-sensitive sectors react to president trump's confirmation he lent meet chinese president xi jing ping before the march trade deadline full year topic jumps as chunz boost sales of its high demand products we'll be speaking to the ceo jean-paul agon that's at 12:30 gmt.

skanska warns that activity is about to level out, but the ceo says he is still bullish on north america. >> we can see good markets in the u.s. a good demand for intra structure, and mostly on the state level. all the projects we are involved with or funded >> u.k. prime minister theresa may and president jean claude junker agree to further brexit talks and vow to find a way forward with less than 50 days to go. >> we have agreed that talks will now start to find a way through this, to find a way to get this over the line, and to deliver on the concerns that parliament has

skbro thaep friday welcome to "street signs." actually, u.s. indexes posted its worst day in two weeks, and that's after news that president trump will not be meeting where his chinese counter part ahead of that march 1st deadline for trade talks. that weighed on sentiment yesterday as we headed towards the closing u.s. equities. continued into asian equities. negative sentiment too noek neek had its worst session in a couple of week as well. it's not just about the meeting or the meeting that's not going to be happening. also, global growth concerns are weighing as well let's not forget in europe the europe even commission yesterday released their forecast for the year big downward revisions for italy, germany, and the u.k. lowest level since 2009. the world is gripped by not only a deteriorating trade nar ti, but also, much lower and slower growth forecasts coming out of european commission and central banks as well.

the picture for europe this morning is pretty much split you can see stocks, europe is opening up moderately higher, but generally quite lackluster activity after the weaker session. let's get into the individual, though i want to break it down for you. the picture is a bit more positive than some of the news we had in asia ftse 100 above the 7,100 mark. about .2% hire than yesterday. we closed down 1 hers e% after the weak forecasts coming out of the bank of glantd dax up about ten points. cac up it .it2. ftse up .4%. it's been a tricky couple of days for the italian asset market this accident again, on further growth revisions down wards from the european commission. .2% for this year. it's forecasted to grow, and that led to a big repricing in italian yields yesterday to the tune of about ten, 12 basis points higher.

equities seem to be bucking the trend this morning let's get into sectors, though let's get to the end of the earnings season. a couple of names that stand out, though. to the down side we've got construction material down about .4%. autos down .3% more stories there renault has also found some news that's suggesting that they helped finance part of former ceo carl ghosn's wedding not a good thing for autos autos down .2% also in line with the deterioration and optimism around the trade talks as well travel measure down .2%. air france, klm, one of the underprfgs names there, and up at the top we've got household goods. some positive results out of la real and hermes. irrespective of what's been happening with china on the ground, the demand for luxury still seems to be holding up, and then technology right at the top as well. i want to bring you to our top story today. that is that the e.u. and u.k. have agreed to hold further

talks on breaking the brexit impasse after meetings in brussels failed to yield a break-through. u.k. prime minister held separate discussions with jean claude junker and donald tusk seeking changes to the irish backstop in a joint statement, both sides said their negotiating teams will meet in a bid to find a way through. now, speaking after the meeting, prime minister may, european parliament president antonio warned of the catastrophic consequences of a no deal brexit this is the reality of a no deal brexit it should be a dangerous solution, no deal brexit zoo let's get to wilham who has been waufing all of these dwoemts developments we just heard from tajani they're warning about the no

deal brexit. we are less than 50 days away. the default snar joe is no deal. is there any cause for optimism here >> well, we heard from theresa may yesterday that these talks would yet yield more talks on monday down in straussburg the other places where the european parliament meets, of course no indication so far from any of the four european officials she met with here yesterday that there would be any substantial concessions on the irish backstop that's the insurance policy guarantee around the hard border essentially no sign that they would help her find any legally binding replacement or a replacement to the backstop that those in westminster have been seeking. mrs. may still putting a positive spin on the meetings yesterday, though. >> had a good series of meetings today. we've had robust discussions, but they've been constructive. what i've set out is our clear

position we must secure legally binding changes to the withdrawal groemt to deal with the concerns that parliament has over the backstop taking that together with the other work that we're doing on workers rights and other issues, will deliver a stable majority in parliament, and that's what i will continue to push for. it's not going to be easy, but crucially, president junker and i have agreed that talks will now start to find a way through this, to find a way to get this over the line, and to deliver on the concerns that parliament has so we get a majority in parliament i'm clear that i am going to deliver brexit and will deliver it on time that's what i'm going to do for the british public i'll be negotiating hard in the coming dawes to do just that >> if you take a step back from this you essentially hear in the statement from the two leaders they've agreed to disagree on this concept of reopening the withdrawal agreement what we did hear yesterday was that they are willing to maybe

add some words, change some words in the non-binding political declaration attached to that withdrawal agreement that would try and reassure once again members of the british parliament about that backstop not being "a trap. one other alternative, that's the commission side. one other alternative froeted by a senior member of the european parliament, he is, of course, the brexit coordinator for the european parliament, was the idea put forward by labour party over the last couple of years and then reiterated yesterday in a letter from jeremy corbin to theresa may that one of the five conditions he would like to see met in order for the labour party to support mrs. may's deal involves a permanent membership of a "comprehensive customs union" here in europe. take a listen to quite how he welcomed and accepted that letter from jeremy corbin. we welcome the letter that jeremy corbin has written today to mrs. may to offer such a

cross-party exit, i should say, to the brexit. it's important now that this leads to a position in the u.k. that has the broadest possible majority so that we can conclude this negotiation >> so to discuss the implications of a customs union membership, i'm happy to say we're joined this morning here outside the european parliament by dan dalton, a conservative mep based here in brussels and also a former tradeparliament. let me ask you, the proposal for permanent customs unionship, why is that a problem? >> i think people misunderstand what a customs union is. effectively, if you are outside of the e.u., it's effectively an import policy. let me give you an example if the e.u. does a trade deal with canada, for example, which it has just done, and they've agreed to reduce tariffs to

zero, e.u. exports hit a 0% tariff, canadian exports to the u.k., 0% tear arifftariffs. u.k. manufacturing exports to canada hit the wto tariff. it's an asymmetrical process you don't get any benefit for the u.k. actually by being in that customs union the only benefit is an import policy and no internal borders snoo when members of your own party talk about being trapped in a customs union by this backstop, what are they concerned about? is it that lack of parity in terms of what that means >> it means that if you are a manufacturing business based in the u.k., you're not going to have access to any global markets outside of the u.k. on preferential terms at the moment in the e.u. the u.k. does have that. we lose that the day we lose the e.u., and the aim for many on the conservative side is to have an independent trade policy where you can go and negotiate your trade deals

in this case we not only can't negotiates trade deals, but we also don't benefit from the e.u. trade deals. therefore, the only preferential access that we get is in the e.u. itself. it's a much worse position than actually we're in at the ploemt. >> leave the u.k. in a worse position in the future what is a solution that avoids a hard border on the island of ireland? >> it's very difficult if you are in different customs territories, it's difficult to avoid a border i think the u.k. government has looked to technological solutions. that's certainly a policy. it needs buy-in from both sides. at the moment that isn't there >> this is the challenge for both the british and the irish governments to avoid that hard border as they both promise to try and do if the u.k. continues to maintain this idea, as trees why may has continued to espouse that she doesn't want to join a customs union, you are saying right now unless the europeans buy into a solution that doesn't seem to exist right now based who o what their studies have show, how will this end? >> there hasto be a border somewhere, and this is the problem with a backstop.

where does the border exist, the customs border exist does it exist within the u.k., northern ireland and the u. kfrk., and that's difficult for members of the u.k., and does the border exist between ireland and the rest of the e.u. i think that's actually the problem underneath all of these discussions is that there's no way the e.u. is going to insure there's a boarder between ireland and the rest of the e.u., but also the u.k. isn't going to move on its border. you are still stuck in this impasse. you are saying they want it to be theresa may's responsibility because, otherwise, it's their responsibility >> if are you in different customs territory, you have to have a border somewhere. the debate is where is that border >> thank you for joining us this morning. dan dalton, conservative mep based here in brussels some of the times, at least, and, of course, a member of theresa may, the prime minister's party in the u.k. >> highlighting some of the

issues that are still at play here thank you for bringing us that from brussels. another story we've been following very closely france has recalled its ambassador from rome following a meeting between luigi di mio and yellow vest activists. they've accused italy of interference in its domestic politics saying it has been the victim of unfounded attacks from rome for several months now. in response, the fellow deputy prime minister looked to calm the tone saying italy is ready to turn the page with france interesting one. that one elsewhere, president trump says he will not meet with his chinese counterpart xi jing ping before the country's march itnd deadline to strike a trade deal. his remark come after cnbc reported it was "highly unlikely the pair would meet in the coming weeks." however, an anonymous senior white house official told cnbc that trump and xi are still

liable to meet shortly after the deadline following the u.s. president's planned summit with north korea's kim jong un. now, u.s. trade delegation is still set to travel to beijing next week to continue negotiati negotiation. eunice has more details. >> when asked by reporters if he and president xi jing ping would meet this month ahead of the deadline, president trump shook his head and said no the signal is that the negotiators haven't made enough progress for the two leaders to meet the lead negotiator and trade representative bob lightheizer said that enforcement is a foundational issue what beijing will agree to is still unclear. lightheizer and steven mnuchin are expected to advance the deal any final deal would not be completed until he and president xi met to work out the tougher points white house economic advisor larry kudlow said that the two sides are still pretty sizable

distances apart, though he said that all is not lost >> the president said a number of times that he expects to meet with president xi on trade when and where is totally up in the air at the moment. does it depend on the meetings this week? i wouldn't want to say one way or another it might hopefully the meetings will go well as i say, we've got our varsity team in there. lightheizer and mnuchin. at some point the two presidents will meet. that's what mr. trump has been saying, but that's off in the distance still at the moment >> and that uncertainty has raised expectations that tariffs could resume and rise in march from the current 10% to 25%. and another twist in the story. president trump is reportedly set to sign an executive order banning chinese telecom equipment from u.s. wireless networks according to politico, the trump

administration wants to "move the needle on security." the u.s. has previously warned that hardware from chinese companies could provide beijing back door access into american networks the story that we certainly have been following very closely, if you have any views on anything we've discussed so far, be it brexit, the price action in markets, italy, get involved in the conversation as ever you can follow us on twitter that is street signs cnbc. you can tweet me directly. i am at cnbc coming up on our show, it's worth it beating expectations as chinese demand boosts sales of its high-end product juliana is live in paris with all the details. that's coming up next. i'm a veteran

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. >> there's demand when it comes to commercial development. for example, we had a record year both when it comes to gain on sales and also leasinleasingd despite the slower market, we still have a good profitability on those areas in the construction stream, it's encouraging to see that the strategic action which we took last year is starting to pay off in the fourth quarter. there's a january rise after figures were showing that planes were less full during the month. the passenger data comes as the company looks to overcome recent strikes and narrow the

profitability gap with its partner klm. and moving on to the luxury sector, hermes has posted fourth quarter revenue of 1.65 billion euros. sales increased 9.6% at constant exchange rates with revenue rising across all regions. the ceo said momentum was still strong the handbag maker confirmed its full year guidance and said its operating margin should be posted 34% that's slightly lower than 2017. elsewhere l'oreal has reported its best annual sales growth in over a decade after a strong fourth quarter and its chinese and luxury divisions the maker of lancome has reported a profit and a new record for its operating margin. the stock is up over 23% we said 23% over the last 12 months 6.5% the last three months, and

a little bit higher today up .4% pretty much in line with overall market activity. not really outperforming per se despite the very strong numbers. let's get out to juliana in paris who has been following all of this. it's interesting, juliana. we were just talking about hermes and l'oreal both companies seem to be underpinned by continual strong demand coming out of china what more can you tell us? >> absolutely. these come on top of strong growth as we saw from este lauder more of the same, interestingly, on that strength in china. now, their growth -- l'oreal's growth in their mass market consumer products division much more subdued relative to that growth in luxury, so big divergence in terms of their divisional performance, and also, of course, that divergence in terms of regional performance with the developed markets lagging significantly behind new markets. now, i just had a chance to listen to the ceo jean-paul agon

in the analyst meeting, and he very clearly on no uncertain terms on china said that they saw no slowdown in china in q4 or in january of this year also, no slowdown in travel. one of the big questions is, of course, around the sustainability of this growth in china given the weakening indicators that we've seen across the consumer space in china more broadly now, he also offered some further insight into the demand that we are seeing across the beauty industry and the factor that is are underpinning it. a couple of things i think worth mighting, this trend towards premiumization, and the idea that consumers are willing to pay more for better performance, better quality in the beauty space. also, this idea that digital and beauty provide a perfect match, which means that they can take advantage of social media platforms, something that l'oreal specifically has been tremendous at doing over the last couple of years, and then, thirdly, increased penetration of bulty around the world, and this is where there are new markets growth coming into the picture. now, in terms of share price

reaction today, as you mentioned, they're not outperforming the market just up a little bit right now on the day part of that is because lois were firmly expecting these results to be strong the other thing i would flag, margins are slightly underwhelm. they came in line with expectations, but given the strong top line growth, some will question whether that top line growth is coming at a higher cost. then, thrdly, just simple profit taking, as you mentioned shares have performed extremely well into today. i will be sitting down with the ceo for a one-on-one jean paul agon you can tune into the sbu at 12:30 cet. >> very much looking forward to that also, maybe you can press a little bit on the margins. clearly, that has been a focus from the investor community today. now, elsewhere, germany's competition watchdog has ruled facebook abused its social media dominance and ordered the company to curb its data gathering. the body said facebook must secure consent from users before combining data from other apps like instagram with third party

web sites. in a blog post facebook said it will appeal the decision and elsewhere, shares in twitter closed over 9% lower after the social media giant forecasted worse than expected revenue in the fourth quarter. the social media firm also warned operating expenses would increase in 2019 as it invests in "the health of its platform." earnings per share on heavy new for the fourth quarter of 2018 both beat expectations, however. let's get out to elizabeth who can break down some of the numbers for us we saw strong earnings again, yet mother company that's posting strong earnings, but investors seem to be focused on yet again the capex spending outlook and the fact that they have more expenses to be incurred in 2019 >> it's a theme we've seen across tech erjz so far this year we've seen these companies report very strong revenues, very strong earnings, but investors are looking ahead to the guidance, which says they're planning to increase spending, and a particular focus on

security efforts twitter saying operating expenditures are going to increase 20% this year, and a lot of those expenses are towards improving the health of its platform >> what does that mean what is the health of the platform is that terms of weegd out fake news or getting algorithms to -- >> getting rid of fake accounts, getting rid of news that is determined as fake also determining from its algorithm how they can prevent that from happening in the future, and we've seen the monthly active user decline because of the number of fake accounts that have been routed out from twitter's system. >> when you talk about overall activity and critical mass, clearly the big elephant in the room here is facebook, and i want to come back to that story. we found out overnight that the german watchdog is really cracking down on the facebook announcement that they're looking to pull all of the user data from instagram, facebook, and what's app it's a very interesting debate, that one, and it's interesting that facebook are so vigorously contesting against it given all of the scandals that they were

riddled with in 2018 first question is can -- does the regulator actually have the power to exercise authority over facebook's willingness to pull the data to begin with >> it's a great point because essentially what came out yesterday is the german anti-trust watchdog. they base their argument on the fact that facebook abused its market power it had too much of a dominant position in data collection, ask because of that it ordered it to break out the way that it's collecting data, and essentially said users have to give permission individually to what's p a, to instagram if they want that data shared. you can't just have one check box that covers all of your data across all of the platforms. >> it's just surprising that facebook feel that they can get away with everything that happened in 2018, and maybe they're somehow embolden the by the strong earnings season they had just a few weeks ago >> i think facebook is coming out stronger here. the message that analysts are project sg that they're investing in security. they are saying we need to come -- we are doing the efforts that we need to anticipate some

of the regulatory hurdles, and that's why they came out and said we think we're prepared and taking steps and they're appealing this decision. >> we'll be keeping a close eye on that one. also, coming up on the show, we'll be speaking to louis, the speaker the aker solutions that is right after the break. stay with us w, it hurts... (danny) ...that you're not using smarter tools to manage your business. you work too hard to work this hard! collecting receipts? is it the 80s? does anybody have a mixtape i can borrow? you should be chasing people's pets... ...not chasing payments! quickbooks gives you a sweet set of business tools... ...that do all the hard work for you. you may groom corgis, but you don't have to work like a dog. (vo) you earned it, we're here to make sure you get it. (danny) it's time to get yours. (vo) quickbooks. backing you. do i use a toothpaste that whitens my teeth,

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welcome back to "street signs. these are your headlines this morning. european markets are searching for direction as trade sensitive sectors react to president trump's confirmation he will not meet chinese president xi jing ping before the march 1st deadline for a trade deal. full year net profit at french cosmetics giant l'oreal jumps as strong chinese demand boosts sales of its high-end products in the fourth quarter we'll be speaking to the ceo that is at 12:30 cet >> skanska misses forecasts and warns krukz activities about to

level out, but the ceo tells cnbc he still is bullish on north america. >> we can see good markets still in the u.s it's a big demand for inf infrastructure, and it's mostly on the state level all the product that we are involved in are funded >> and u.k. prime minister theresa may and european commission president jean claude agree to further brexit talks and vow to find a way forward with less than 50 days to go before britain is due to leave the e.u. let's check in on how european markets are fairing this morning it is green across the board slightly moderate gains, i would say. ftse 1 up 2% cac up moderate amounts as well.

dax, the lone underperformer down .1% this in line with u.s. equities posting their worst day in weeks. that is a picture across the board there for european equities let's get into foreign exchange as well, and i want to poin out the move in cable. we're down about .2% the decline happened during the bank of england's press conference yesterday as mr. carney was giving their updated projections for the u.k. economy. very, very weak there and has really propelled the cable currency period to weaker levels we're now firmly below that 130 level, which is where we were just a couple of days ago. euro also trading on the back foot down about .14% as well

just a fraction above that 113 level. 113.30 >> looks as though the majors will open up in the red after a weaker session yesterday dow seen opening 70 points weaker, and nasdaq about 35 points weaker. we did have the twitter earnings come out yesterday very weak after hours trading for that stock. almost down 10%. that is weighingon the tech sector as well well, norwegian oil services firm aker posted better than fourth quarter intake and core earnings excluding one of the items in the period in line with estimates. the company highlighted strong performance in front end engineering work in 2018 and reiterated its forecast for higher revenues this year. i'm happy to see that louie, the

ceo joins us can you just describe to us where some of the strength in your fourth quarter has been coming from? >> yeah. good morning thank you for having me. it's actually interesting to see that -- i think the market has set very well. that our order internationally has grown during the year. it shows that we are very competitive not only the local markets in cs, but also in the global international markets a lot of the orders came from africa, and we've agreed to contracts in china >> at this -- this also obviously comes on the heels of a very strong set of earnings we've had out of oil companies as well. totale, shell, chevron, and the last week and all of these oil companies are pointing to a healthy pipeline for 2019. would you say that's also being reflected in your industry as well >> yes, absolutely with the strong clients

repainting the balance sheet to have more cash to spend, that should mean more orders for us we are seeing that it's increase, and we have just had record studies this year, beating last year's studies, and that is a good indication for not only 2019, but also for 2020 >> now, earlier on the conversation you talked about some projects that are opening up in china. back in october you also had an order for the development over there as well.

>> it's actually the provide to provide the -- earlier in the year we also want some specialized cables to another project, so we are very proud of being selected, and we see large opportunities in the chinese market >> a question on your overall business strategy as well, and i think you may have mentioned this earlier on, and i would like to get clarification. you said you may be open to the option of acquiring other companies. could you give us a little bit more detail on what type of acquisitions you would be seeking in ermz it of expanding your business? >> as a matter of fact, i usually don't comment on acquisitions, but what we said

that we acquired the remaining part of a company we bought in brazil two years ago we bought 70%. we just bought the last 30%. we also acquired a stake in an american company specializing in -- it's an area we see as a good area for us as we move into new energies renewables that's what we're talking about. we have a very good potential for growth, but we see that sometimes the ak quizzings we can put on that's what we are focused on. >> let's broaden it out a little bit. i want to talk about the oil sector as a whole. it was a very volatile year for the oil industry, 2018 we are seeing a bit of stabilization in the price do you think that continues, sir? >> i'm sure. the whole index expects this to be very volatile there's a lot of moving parts in what we are focused on is to maintain low cost and low to break even for projects for our clients. what we have done very successfully during the last

two, three years and we are working very close to those clients to maintain that we have not seen any slowdown activity due to the volatility i think as everything else, the market is getting used to that the projects are moving ahead. we see today actually 50 more off shore rigs drilling today than we have in the same period last year. that's very positive >> interesting all right. thank you very much for taking the time to speak to us. that is luis, the ceo of aker solutions there. now, the bank of england held rates at 0.75% at its latest meeting yesterday. as xpected forecast the u.k. economy to grow at its weakest level since 2009 the central bank cut its growth forecast to 1.2% citing brexit uncertainty and a slowing global economy. despite cutting its outlook, the bank of england signalled rate hikes are on the horizon if the u.k. avoids a no deal brexit in a press conference, bank of england gfrp governor mark carney warned of the impact of

ongoing brexit uncertainty >> the fall-out of brexit is creating tensions in financial markets. those remain -- a variety of risk premium on u.k. assets are elevated given the wide range of potential scenarios and the various paths to them, it would be remarkable if the current levels of sterling and other u.k. financial asset prices were consistent with the outcome that finally emerges. now, how these tensions are reconciled once the fog lifts will have consequences for the path of monetary policy in ways that cannot be predicted in advance. to forecast the economy and said monetary policy accordingly, the mpc must make a series of judgments and aassumptions, and first on the judgments, given the dynamics of the negotiations, we are now assuming uncertainty remains elevated for a while and that financial conditions stay tighter for longer >> meanwhile, the e.u. commission expects italy to post the slowest growth in the euro

zone this year brussels has forecast italian gdp to grow by only 0.2% in 2019, blaming rome's government for increasing uncertainty and raising bar rowing costs the european commission vice president has told cnbc that frig illty in the economy needs to be addressed. italy has slipped into its third recession in a decade after its economy contracted at the end of 2018 now, this came after a rou between the e.u. and italy regarding 2019 budget deficit targets. e.u. economic commissioner said italy's economy could have suffered more if a deal hadn't been reached >> you recall that this came at a time of uncertainty of professionals in italy, which resulted in high market volatility, and a rising sovereign yields, and you saw that the agreement we have reached help in alleviating

market tensions shown by the sizable declines of sovereign yields and this is why i repeat that without the budget agreement concluded in december, the situation would have probably been worse, and i couldn't evcoul even say much worse. let's take a look at fixed income we have bunds close. it rallied all the way back from 30, 40 basis points level that we were at just a couple of months ago ten-year gilts ten-year france around 55, and italian yields 2.95. i want to pick up on the ten-year italian yields with an expert joining me now is andrea you are a special income specialist not because you are italian. >> well, maybe >> let's talk about italian bund yields we've seen really big move higher in the last couple of weeks. 40 basis points widening, and

btb yields december, a lot of people turned optimistic once italy somehow avoided going into the excessive deficit procedure. they tweet the budget deficit to 2% of course, we now know that those growth forecasts were completely out of whack. the european commission is forecasting growth to 0.2% people are getting nervous again. how do you see this panning out in terms of, one, market volatility, and, two, the trajectory of italian yields from here? >> if you look at the spreads, they've done well in q4 of last year with the key spreads of bunds tightening by 50 basis points as we have seen, it's all down to growth. forecasts for that gdp deficit is only as good as the actual gdp number that you put in it. >> yeah. >> and where we are from here, 250 that we reached in terms of the tightest levels in spreads is difficult to see bdp's trading meaningfully tighter

than that. if anything, going ahead you are going to have more risks of further widening you have the european elections coming up in may that's going to be another sign post to have in the calendar uncertainty will be alleviated >> it's very easy to construct a negative case for italy, and we certainly have been doing that you know, they've given us many reasons to construct a negative case over the last couple of months, but one thing that's different is the tone has come down a little bit. less talk about leaving the euro zone and creating a side currency whatever it is and more -- well, less confrontational. even yesterday with the incident with france, it was mr. selvini who said, all right, we're open to discussions, whereas all of the ayre was directed at mrmr. d mr. demayo do you think we're in a situation where yields replicate the moves that we had last summer simply because people are so concerned about the growth outlook, or do you think the political rhetoric coming on mr. selvini will overcome these

concerns for the time being? >> well, it does feel like the rest has been more balanced as you say. however, politics will play a part, but it's all down to the numbers. it's all down to the macroenvironment, and gdp growth will continue, and ip, pmi's will continue to be the main driver of spreads. you are going to have a lot of headlines coming out from political arena, but what the markets will be looking at really is what's the economy doing, how -- is there actually a spillover from higher yields and refinancing costs that we've seen last year into the economy? >> loads of people are throwing up the r-word, recession euro zone is entering recession. we're not quite there yet, but growth has certainly dropped significantly for italy, technically in recession wrrks germany as well. skirting very close to it. are we on the cusp of another sovereign debt crisis?

>> it's difficult to say what is certainly not data has slowed across the board. in large part in the countries like germany and italy that have a lot of ek posure to exports to china and emerging markets, so they've been dragged down by external factors and in the case of italy, there's also been some self-made issues that we've seen last year. now, in this context, expect the ecb to remain a commodity due to supportive to the market and to the economy. most likely they're going to roll over the tro facility, keeping. it's unlikely they will be able to hike rates at all this year maybe a small increase, but it's not going to really change the dial >> do you see a situation where the economic back drop deteriorates so much that ecb have to reintroduce qe again and remove the forward guidance

language back to a lot more accommodative language >> it's a big question mark realistically because the political hurdle towards reopening qe is very high, and so, you know, things are going to have to get a lot worse before the ecb can step in more importantly, what will be important will be the reaction on the fiscal side some countries more than others have physical room for maneuver. before the purses can be opened again, you need a bit more vol, bigger drawdowns, and a more meaningful slowdown in the macropicture what we do see is if you look at the bund curve, for example, a lot of the bad news that we've had in germany is already priced in >> with bunds trading at ten basis points -- >> exactly exactly. you know, tactically we're happy to take the other side of this peak panic that we may be seeing in german assets >> all right peak panic, right? we'll watch out for that over

the next couple of months. thank you for joining us on the show today the investment director from fidelity international also coming up on the show, england's rugby pulled off something of a shock to beat ireland in the six nations last weekend. we'll tell you why it's already the big financial winner of this year's competition stay with us unpredictable crohn's symptoms following you? for adults with moderately to severely active crohn's disease, stelara® works differently. studies showed relief and remission, with dosing every 8 weeks. stelara® may lower your ability to fight infections and may increase your risk of infections and cancer. some serious infections require hospitalization. before treatment, get tested for tb. tell your doctor if you have an infection or flu-like symptoms or sores, have had cancer, or develop new skin growths, or if anyone in your house needs or recently had a vaccine. alert your doctor of new or worsening problems, including headaches, seizures, confusion and vision problems. these may be signs of a rare, potentially fatal brain condition. some serious allergic reactions

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welcome back "street signs." sony is launching a 100 billion yen buy back as it looks to boost shareholder returns. the move sent shares in the japanese electronics and entertainment firm higher, but follows a tough week for the stock, which has traded lower on a more pessimistic revenue outlook. sony's announcement also follows a string of recent buy-backs by some of japan's biggest firms, including a 5.5 billion dollar plan from tech giant softbank. and elsewhere amazon ceo jeff bezos has accused the national enquirer and its parent company, american media, of extortion and blackmail. in a blog post bezos said the

tabloid threatened to publish intimate photos and texts between the tech mogul and his girlfriend claiming ami had asked him to deny any political motivation in the publisher's coverage of his divorce. ami did not immediately respond to cnbc's request for comment, and a representative at amazon was not immediately available. england's rugby team is getting used to being labelled as the new favorites for this year's six nations tournament following the impressive win against ireland last weekend coach eddie jones and his side will be looking for another win when they face france on sunday. adam joins me to discuss i was going to make a joke about the irish backstop, but i think it would be distasteful, but how is the french backstop looking for this saturday? >> well, depending on how you look at it, really, because last week france looked like they could do anything in the first half when they played their

opening match against wales. they raced into a fairly huge lead, but then the other side of the french performance came out very much a jekyll and hyde, and wales came back. the irish backstop was not as strong as you nay -- >> of course of course. >> it's against england. they had the big defensive performance, england, and then now they're being talked up again as potential favorites it's such a huge year for rugby as well. very early stages so far in this year's six nations it is a big event that will gather momentum and considering the way that test rugby works, it's a very different barometer to maybe the way that international football works it's a lot more fixtures, competitive fixtures, in english football or world football, for example. there's not many games before the world cup. >> we're a business channel. we're always interested in the finance aspect of things six nations, as you said, is

growing in viewership, getting more and more viewers every year both spectators and the actual arena versus people who are watching on tv as well what type of money is associated with the six nations, and how is that -- how does that tend to be allocated amongst the different countries? >> it's quite unusual, the six nations. in the sense it's an annual tournament they call itself rugby's greatest championship, but as we explained last week, they've had sponsorship problems, and the people that look after the tournament itself, they try and -- they believe that it's worth a lot more than what guinness, the sponsors, have ended up paying for it in this year of such a huge year for rugby, bear in mind the world cup is going to be played in japan, the way that the allocations are made for the six nations itself basically depends on the size of the unions that are involved really. england have the biggest pool of talent to choose from. the biggest union, and they get the most money for it. this is even before prize money even gets allocated. the grand slam, if a team goes through the tournament

unbeaten -- well, beaten -- the sides around it, so england, scotland, and wales were -- are the only one ones in line for that there's a potential $7 million available extra on p to of those figures. >> you never want to go through an experience like that again, so you learn from it quickly you try and make the most of being in a great environment like this of being challenged as

a player, being challenged as a team, and like i said rg continually trying to get better campaigns campaign week to week so that whatever tournament we're playing in, we can get a good shot. zoo how satisfying was that win, considering so much of the talk beforehand have been about ireland and they were the favorites and even now they're the favorites for the world cup, for example. >> obviously, it was a great win for us we wanted to start the tournament really positively, and we did that. we didn't listen too much to what was going on in terms of the exterior stuff we purely focused all our time and energy as a team, and i think that's why i said earlier the genuine preparation definitely helps because you can see that in the way we play. >> all right that's my saturday sorted. thank you for watching and try align gummies, with prebiotics and probiotics to help support digestive health

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zblierkts your top five at 5:00 begin with a bm shell stunner from jeff bezos. he is blasting the national enquirer, accusing its parent company of trying to blackmail him over indiscreet pictures between him and his girlfriend lauren sanchez the full late-breaking details straight ahead stocks, meantime, under pressure president trump saying he will not meet with china's president before next month's trade deadline think skin kbri in 2019. not, obviously not about your weight. that's the market message from goldman sachs's chief global equity strategist, and he is he