partners zbrierchlts president trump praises vietnam and hails an awesome future for north korea if it gives up its nuclear weapons, as trump is getting ready for his dinner with kim jong un in hanoi ahead of tomorrow's summit.

>> we have a very big dinner tonight, as you know, and meetings with north korea, chairman kim we both felt very good about having this very important summit in vietnam because you really are an example as to what can happen with good thinking. federal vooev chair jerome powell said the u.s. is economy is generally healthy, but tells lawmakers the central bank is ready to adapt policies as he warns of challenges abroad >> financial markets have become more volatile, and financial conditions are now less supportive of growth than they were earlier last year gloet has slowed in some major foreign economies, particularly china and europe >> find out that the fundamentals are tighten iing

encouraging my colleagues. klm, shares have slumped in early trade after the dutch government has upped its stake in the airline the move came as a surprise to the french government with the finance minister who said the carrier must be operated without national public interference both countries hold stakes in the airline, but currently the macron-led government has a larger holding of 14.29% now, finance minister says he ames to increase the dutch holding to 14% to insure "we have a seat at the table." now, i would like to bring in

nuala mcmahon. this came as a surprise to the frerchl government, and tensions have been running high between the two parts of this airline company, air france and klm since the merger in 2004 what is this development meaning for the merged company at this stage? >> yes well, initially the headlines by the market is with a larger stakeholder by the dutch government it was given less flexibility to make strategy eenlic change which is needed within the overall air france airline the stake holders, china, eastern, and delta have combined 15% stake. the concern was also with them that they wouldn't be able to get flexibility into the model, but actually, since the arrival that hasn't been the case. already they start to see change within the overall group

there's no question the dutch government wants their interest protected, ie, klm, but you have also seen recently peter alberts taking up the desk at the ceo role he seems to be backing ben smith and the overall group strategy could you go into what makes more confident for ben smith having a greater stake >> again, it just comes back to what i was saying. it was 15% initially with the shock announcement that the french government didn't know about this, but it's actually ticked back up to minus 12 because actually what it means is you have another large stakeholder party, but once you have all the interest combined in terms of having overall group profitability, then it makes sense for a number of partners the whole -- what we heard ahead of full year reserves was concern from the dutch government and klm that peter albert, ceo, wasn't being

supported, and his stark concerns enter political tensions between the dutch and the french what the dutch have done now is they're taking a stake at the table because actually they're permitted to the overall klm within the overall air france klm group. actually, i disagree with the comment that it will give them less respectability and in essence it's tying the two airlines closer, which makes sense on a number of points. especially if you combine aircraft purchases in the future snoo in terms of the gap in profitability between air frances and klm, still a great deal to go in terms of closing that gap, and klm's operating performance still much better than that of air france. in your view how realistic is it that they can actually close that big gap that currently exists >> yeah. there's no question. it will certainly take time, but, again, what can you see -- we did a lot of work that he did in air canada and that we draut brought across air france. he already starts to get that change through he is holding june into the

overall air france, and he has already started to restructure the group's regional business. it will take time, but certainly, he will be able to close that group with a margin today what it confirms is the klm government having a seat on the board. you need both those airlines closer together.

and zbrierjts president trump has highlighted the -- what do you think president trump's aim was of tweeting about the boom that might lie ahead for kim jong un? >> they're really being tout as one of the winners of the trade war. let's make a note of the fact that discreet vietnam happens to be the number four biggest trade partner for countries like south korea. really, sounds very attractive, and it's very interesting, too

june last year it was irreversible denuclearization. this time around washington officials emphasizing the economic potential of north korea. as you just talked about, in his meeting between president trump and, of course, his vietnamese counterpart, this is what he had to say take a listen. >> i very much appreciate the hospitality. it was a really something special. we got off air force one last night, and i drove down the boulevards, and i saw all of the buildings under construction and how vietnam is thriving, and very importantly, we have a very big dinner tonight, as you know, and meetings with north korea. chairman kim we both felt very good about having this very important summit in vietnam because you really are an example as to what can happen with good thinking. >> before he made those comments, he also tweeted out in hanoi saying that, you know,

this economic potential is all in caps awesome, and he also called kim jong un his friend. certainly interesting way to set that table for dinner tonight. the question is, of course, if north korea is interested in anything like that, that what would be the way that washington concedes and accommodates that kind of economic potential we've seen president trump and north korea's leader kim jong un, want in eight months, and what kind of chemistry do this he show to the world is very much in focus. guys, back to you. >> i want to bring in the head of asia research at varisk naval croft. what are your expectations for

this summit? are we actually going to see any substantial progress or is this just going to be a meaningless symbolic gesture >> well, we wouldn't expect any kind of tangible or lasting process auto denuclear zblaegs as we've been saying for a very long time, and it's become apparent after the singapore summit last year north korea is simply not going to unilateral denuclear aize if this is going to be the main item on the agenda yet again, it can only result in kicking the nuclear can further down the road and resulting in a more of a symbolic conclusion. now, we have seen some encouraging signs from the white house from the trump administration hinting that they would be happy with kind of more modest goals, such as a more indefinite freeze on missile testing and production, for

example. this does indicate that there is an awareness that denuclearization is simply not going to happen and that they will settle for more achievable goals, which is actually quite an encouraging sign. still, anything that we'll see either today or tomorrow will take a very long amount of time to -- details will need to be harbored out and ultimately, any progress will remain at the mercy of north korea, and it can fall apart or be reversed at any moment >> very clear, in your view it would be a positive sign of president trump instead of focussing on denuclearization actually focuses on more limited steps, albeit, less impactful. now, to your last point about north korea and how much hinges on their willingness to make concessions, how likely is it that north korea is going to be willing to make any kind of concessions that are actually irreversible >> it's not very likely to do

that we have credible evidence suggesting that they may be willing to offer up a permanent testing freeze, for example. we need to recall that north korea has offered the closure two times before, and both times the facility was reopened. certainly we expect kim to offer some concessions because his one and overriding role in all of these negotiations is to get secure and easing or lifting of economic sanctions we believe that if he has credible assurances that that will happen, he is willing to meet the u.s. at least halfway, but every step needs to be

verified it needs to be fool-proof, for lack of a better word, because if north korea can reverse a concession, it will certainly do so if not next month, then maybe a year from now. >> just before you joined us on the show, we were talking about president trump's tweets about the economic potential that lies ahead of north korea in his view firstly, do you think that this is enough to convince kim jong un of the merits of coming to some sort of groemt with the u.s. and, secondly, do you believe that is there really an economic boom lying around the medium term corner for north korea >> well, on paper north korea is a promising investment destination, right if we look at any industry, any economic sector, we would have to be modernized, rebuilt from scratch. it has trillions of dollars worth of, you know, untapped mineral deposits, but the reality is it is one of the most

hostile countries in the world for foreign investors, right we've seen some promising signs on marketization, so the economy has opened up over the last few years under kim jong un, but further steps, let's say if we want to look at vietnam as a possible kind of template for an opening up, says it would require a certain liberalization, you know, societial, right, vietnam is still nominally a communist country. it has managed to transition into market economy while returning -- retaining its political system, but that kind of kmang will require chaksz to g from property rights protection to that kind of transformation is extremely risky from kim jong un's perspective. he has very little to gain personally, and he has very much

to lose. we would be a little bit reluctant to necessarily view vietnam as a viable template for north korea to follow. >> excellent well, thank you very much for those thoughts head of asia research at varisk naple croft. to see what north korea wants from the talks, head to cnbc.com coming up on the show, the u.k. government warns the british economy could be 9% weaker in the event of a no deal brexit. we'll be live from westminster with the latest after this break. ♪ (butcher) we both know you're not just looking for pork chops. you're searching for something more... ...red-blooded. right this way. you thirst for adrenaline, you hunger for raw power. well, you've come to the right place. the road is yours, dig in.

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get $250 back when you pre-order a new samsung galaxy. click, call, or visit a store today. yesterday we had a lot of focus on the u.k. with a number of skon concrete developments coming out on the brexit side of

things, and, of course, hanging over markets from a macroperspective that trump-kim summit taking place in hanoi this week. again, as i said, the main focus hoed today for investors here in europe are these single stock stories. currently trading down 0.7%. worth noting that every major index in europe this morning is trading in the red a little bit of a pause and moment of caution coming through markets coming after the relief rally we saw on those u.s.-china trade developments earlier this week and towards the end of last week, but it looks as though the european marks are following asia and following wall street around that cautious tone. as i said, a big day for corporate stories. the only sector in the green at the moment is health care. there we are seeing the index boosted by buyer they came out with strong q4 numbers relative to expectation, although they continue to have a number of issues around the monsanto lawsuits in the u.s

they are showing relief with respect to earnings. the air france-klm story the news that the dutch government is reducing their stake, and it's weighing on investors as to what that means for the air france klm company moving forward and what that means for integration. a little more detail on the u.k. brexit story prime minister theresa may has offered m paul ryans the opportunity to vote ro a no deal brexit and on delaying the date britain leaves the e.u. if parliament rejects her agreement. meanwhile, the european union's chief brigsz he brexit negotiate or has set a firm decision not more time is what's needed to get bricks it across the line. speaking on the radio this morning barnier said he is doing all that he could and reiterated the irish backstop could not be renegotiated the u.k. secretary brexit

secretary steven barclay has also been commenting saying a no deal brexit is still on the table. he is focussing on what he thinks is significant. to make sense of all of the context, i'm joined by a focused professor on european politics, foreign affairs. thank you for being with us.

snoo i think she could have done more after it's evolved over the last 18 months she's not blameless in all of this equally on the other side, parliament has been quite slow to focus on the real issues at stake here i think the vote back in january that the prime minister had lost by 230, was a massive luxury let me stake out my position rather than thinking that there might be difficult choices and trade ahead. essentially the three-fold choice between this deal, no brexit, is or a no deal brexit i think that's starting to crystallize in people's minds now, which is why there are people saying that in two week's time this deal might get through. one person we heard from this morning, jason reece, he is the head of the hard line faction within the conservative party here, and that is the european research group, and what he said is he can now live with the irish backstop. a very thorny issue. part of theresa may's deal

so long as there's a deadline date put on it that's different than what he demanded a few woeks skparks that's one of the reasons that we're seeing a delay, and that's that he wanted to withdraw the agreement and have text reopened is this a good example was it showing that he was being a bit disingenuous a few weeks ago? >> there are factions within that faction, and the elg is very divided how many die-hard brexiters will just vote against this deal, whatever jason receipts morgan, very interesting. it has shifted dramatically it extensively, and now he is saying a codicile will work for him. the back drop is that theresa may for the first time yesterday started talking about the possibility of delaying march 29th jason is among those brexiters who has said repeatedly that that would be the fit edge e end of the wedge

it means sacrificing breck it. for some on the brexit side, they would rather voted for theresa may's deal >> does that mean in your view what we heard again is that no deal has gone from a probability to ail possibility and that's a realistic assessment right now >> i don't think much has changed around that, simply because there has always been a massive majority in parliament that doesn't want no deal. the problem remains what it's always been, which is you can't for all that the claims that her amendment would have done it, take no deal off the table unless you vote for something else that's the test that parliament faces now. not simply running out a long list of things it doesn't want, but deciding on one brexit outcome it does want, and that's what we're waiting to see. >> it's that point that there is no deal as a possibility so long as no one can agree on an actual deal >> you can't rule it out without

changing the law by law we are leaving the european union what you can do is delay that day, but the default situation under law in this country, if nothing else happens, is that on the 29th of march we leave the european union if we don't have a deal so be it snoo what parliament has to do to take no deal off the table, rather than push it back in time, is come up with another outcome. they released a littany of items yesterday that explained what the impredictions of the no deal brexit would look like for the economy, for various sectors, and i'm wondering from your perspective, do you think that kind of information or the political pressure is what drove theresa may to open the door for postponement yesterday >> i think theresa may has increasingly moved from her previous position around the general election of 2017 and saying no deal is better than a bad deal because she's gotten to grip with how bad no deal will

be i think she's playing a two-fold game study says like the ones that came out yesterday are targeted at those with a point of view and in the labour party saying, look, you're playing with fire if we leave with no deal, these are the consequence questions. i should say in that report, one of the interesting things is we keep on saying particularly bad for northern ireland because we have dup in might not. on the other side she's talked to people like jason rece morgan, you better move to my deal, and she's playing two different games with two different wings of the party >> keeping that tight rope very, very taught at the moment. thank you for joining us this morning. he is a professor in european politics and in foreign affairs. shares in markson spencer are lower after the retailer announced a joint venture with acado. they'll pay the british on-line supermarket 750 million pounds for a 50% ownership in the jv.

the 135-year-old retailer says it will finance the deal with a rights issue where it will look to raise up to 600 million pounds elsewhere in the corporate space chemical and pharmaceutical group buyer has posted a net loss of almost 4 billion euros in the fourth quarter. the company cited one-off costs relating to its take-over of monsanto sales came in just above 11 billion euros. we'll speak to you, verner bouman at 7:00 cet coming up on this show, will opec extend its cuts when it meets in april we'll hear what the saudi energy minister has to say. 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

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explore cost support options. guys go through a lot to deal with shave irritation. so, we built the new gillette skinguard with a specialized guard designed to reduce it. because we believe all men deserve a razor just for them. the best a man can get. gillette. welcome back to "street signs. these are your headlines turbulence ahead air france-klm shares slump as the dutch government boosts it's holding in the airline, increasing tensions with its french partners. president trump praises vietnam and halz an awesome future for

north korea if it gives up nuclear weapons as he prepares to meet kim jong un for dinner in hanoi ahead of tomorrow's summit. zblierngs jerome powell says the economy is generally healthy, but that the central bank is ready to adapt policy as he warns of challenges abroad >> financial conditions are now less support tiff of growth than they were earlier last year. growth has slowed in some major foreign economies, particularly china and europe >> saudi energy minister call he'd al fali tells cnbc opec is leaning towards extending output

cuts later this year >> we find out that the fundamentals are tighterning by june you can bet that i will be just like we did last year. encouraging my colleagues within the opec plus to ease the voluntary limits we have set on ourselves. european markets have now been open for one and a half hours. let's check where things stand at the start of trade things were looking pretty bleak, and that continues to be the case as the morning progresses we're seeing the ftse mib. all major indexes were in the red. a little bit of a comeback there for the ftse mib, but as you can see, u.k., german, and french stocks continue lower. a huge day for individual corporate stories. just to give you an estent of

the single stock moves yesterday the federal chair jerome powell's testimony to the senate was a key focus for 4x watchers we did see the dollar -- some weakness in the dollar, and right now we are seeing that continue the euro is currently about five basis points higher. nearly at that 114 mark. the best performance since november from the poupd, andno we are seeing a continue higher north of 132 quite strong moves on the back of theresa may's decision to open a breaksility delay should she fail to dpet her deal approved let's take a look at success futures. yesterday was a fairly muted session, and elre relative to what we've seen in recent trades for the u.s. all three major indexes ended the day lower. really a pause for breath after that relief rally on the back of

u.s.-china trade jerome powell will be giving another address today. now, oil markets bringing you news in oil markets. they've told cnbc that opec is likely to extend its output cuts later this year. dan murphy spoke to the saudi energy minister and speaks to us live from riyadh what more can you tell us about that chat you had with the saudi energy minister earlier this morning and what he said in particular about the prospect of further cuts later this year >> this was absolutely a wide-ranging conversation with the saudi energy minister call he'd al fala he now said he is considering an extension to the opec cut agreement that was agreed to late last year he also weighed in on that recent tweet from the u.s. president, donald trump, calling on opec to take it easy. he says he hears the concerns of the u.s. president and also the concerns of the u.s. consumer as

well most importantly, and perhaps most consequentially, here's what he said about the potential to see an extension to that agreement when it expierds in june listen in. >> i am leaning towards the likelihood of an extension in the second half, but that's not automatic. if we find out that the fundamentals are tightening by june you can bet that i will be just like we did last year, encouraging my colleagues within the opec plus to ease voluntarily limits that we set on ourselves and to increase supplies to ensure that there is no unnecessary tightening in the market call he'd al fala said that is still up for review, and the fumgtss need to be monitored that's just one conversation that took place at this event today in riyadh. we are at the ief-iea symposium,

and that's a trilateral meeting of the minds, a gathering of these three major organizations to corroborate their research and their outlooks for the year ahead. this comes ahead of the jmmc meeting, and that's taking place and that very important opec meeting. these conversations are important for the market to watch. venezuela and its position the venezuelan petroleum minister was in attendance today. he is not just the petroleum minister he is also the head of the state oil company that just -- that has been under some very heavy sanctions from the united states, and, of course, have seen exports being crippled as a result of that he is also the president of opec it's going to be interesting to see whether or not his presidency can be maintained particularly given that the west, including the united states, has now largely dismissed the maduro government as ill legitimate.

back over to you >> dan, thank you so much for bringing us that conversation. head to cnbc.com for why goldma sachs believes they're in for a wild ride. stack stanny armed forces claim they have shot down two indian fighter jets as tensions between the two countries escalate it comes a day after indian aircraft launched a strike on an alleged training camp in pakistan, which is the fist time india has st