it was all about money. >> welcome to "street signs. happy friday i'm willem marx. >> and i'm carolyn rocks >> you may say, i'm a dreamer. christine lagarde asks the time and defends the measures >> the ecb policy stance has been a key driver during the recovery that stance remains in place >> stocks rebound. european equity markets stage a

come back after a mixed day in asia after the dow logs its largest losing streak since august >> fighting words. xi jinping insists a phase one deal must be based on mutual respect. >> and manufacturing activity in france and germany expanding that beat expectations >> you mentioned some flash data we have some more here we have the november flash numbers for the november pmi coming in at 46.6 and services coming in at 50.3 against 50.6 in october and coming in at 51.5

for november against 52.2 last month. >> we saw the german and the french data that was better than expected that led to the small rise in the euro i wouldn't say it was a huge rise we are seeing the euro changing at 1.1056 given that the french number beat consensus. the german number well below that 50 boom bust level at 43.8 versus 42.1 for october. the services for both countries was below forecast but maybe this points to a little bit of a stablization even though we are still looking at pretty stag nant on this let's bring in the expert on

this chris, stagnation or growth? >> both. it has been three months now of the headline composite pmi around that 50 left. no growth. when you run your models it is indicating not 0.1% gdp growth it has been the manufacturing sector that led this slow down we are showing some signs of turning around, not growing by any means yet. we've had signs of a turnaround. the big question, is it going to continue and is it going to help the service sector the fear is that we are losing jobs in some sectors that is going to feed through the household and why we have the weaker than anticipated services pmis. houses are going to play out keep the sectors resilient and

we'll see the eurozone avoid a downturn >> output prices are against 48.5 the lowest since april 2016 this plays into the expectations of confidence. business expectations come in at 57, the lowest since june 2013 how much optimism must there be? >> we are grasping at draws to some skpent, this downturn has been so severe the decline in new orders was the lowest for 10 months it indicates how much we've come from the lows of the summer. it is mainly the rate of the decline easing there is an additional concern

as well. with the flash numbers, b we see the prints for france and germany. the whole fell for the first time since 2016. signs of life in the core. the rest of the eurozone is turning down further >> many analysts we speak to say this is soft data and that tends to be volatile sometimes you compile this data. sometimes there is a seasonal element or volatility in there and maybe we should be looking more towards the hard data >> it is interesting, if you look at the last two years, it's the gdp data that has been more

volatile we'll talk about the uk later, auto sectors causing a lot of volatility one sector can dominate the figures and really give you a misleading picture of the health of the economy the thing about pmi, it kind of cuts through that noise and gives you this trend of growth they might not get gdp right every time if you take an average, the gdp is usually bang on the money >> for many months now, people have talked about the resilience and the fact that there hasn't been a big spin over the number is striking that business expectations, the index of 57, still above 50. does that mean people on the services side are getting

nervous. >> yeah, it is that spill over it is happening and the transition for that is the labor market surging jobs growth a year and a half ago, a year ago that change in hiring will affect household sentiment the list will come if you see the manufacturing sector continue to ease the rate of decline and move into a positive territory. at the moment, yes, you are seeing that weakness come through. >> that is quite worrying. chris, we'll talk more with you through the show stick around meantime, let me show you what is happening roughly one hour into the trading session tgif, you would argue given that we've had a lot of back and forth on the u.s./china trade

line a lot of question of is it going to happen? last word we heard is that there might be a delay this is what trading was driven by we've had four days of losses on the stoxx 600. maybe a technical reaction, the stoxx 600 up by 0.7% let me show you the individual markets. you'll see we are in the green the dax is up 0.6% the ftse 100 in the uk up a little more than 1%. sector wise, we are seeing a little switch from yesterday yesterday, we saw the defensives outperforming. today, reverse basic resources. best sector up by two. banks up by 1.3.

only utilities underperforming the focus today wasn't so much on the trade stuff but really lagarde which you will be talking about now and the pmi numbers. >> we'll bring you highlights from her first high-profile policy speech. she is talking apportions. >> the ecb stance has been a key driver of domestic demand during the recovery that stance remains in place as laid out in the ecb forward guidance, policy will continue to support the economy and respond to future risks in line with our price ability mandate yes, we will continuously monitor the side effects of our

policies but it is clear that monetary policy could achieve its goal much faster and with much fewer side effects if other policies were also supporting growth. >> she also mentioned ongoing trade tensions are contributing to slow down i'm happy to say we are joined by senior lecturer what is the point of the phase one trade deal wehear so much about at the moment? >> it is really a pretty hollow deal it is politically skpeedent especially for the u.s. president feeling a lot of pressures for other reasons at home it is very flawed in that it

focuses on sort of a bilateral fix to focus on america's multilateral trade balances with 102 countries. it is a ridiculous effort and it doesn't address any of the structural issues that the u.s. was so adamant about in launching the tariffs. this is a super official effort to bring an end to a really difficult conflict between two countries. >> it complicates what central bankers will do next for the ecb, the fed, policymakers around the world when you take a look at what central bankers could be doing next, their hands are really tied they've used up all the arsenal they've had over the last couple

of years and now say, hey, the ball is in your court. is that fair is there room on that side now >> caroline, i've been around long enough to remember that this is a pretty time worn mantra of central bankers. they always say there is a limit to what we can do. we need for miss call policy, competitiveness policies that is very much true today with policy rates close to zero and balance sheets having expanded to unprecedented levels for most major central banks i'm a big fan of what christine lagarde has done and what she

said today i think it terrific in focusing on the tough structural issues of whether it is demography or trade tensions both of which she worked on effectively when she was the head of the imf. can monetary policy address those tough issues the answer is no all the monetary policy can do is to stay accommodative and hope that the policymakers charged with dealing with these tough issues will address them not clear they are willing to do that so she's level with little choice >> interesting she also talked about the side effects of the policy and unorthodox measures they've taken. we've heard from the vice

president of the ecb the vice president telling us, in a way it is our fault we are limited the banks responsibility and limited the risk taking. what can the ecb do about that, if anything? >> that's a really tough question i think the side effect issues of swoelen balance sheets raises a lot of concerns that many have with respect to potential asset bubbles, which of course gave us a horrific crisis 10 years ago so it is one thing to talk about side effects it is another thing to wean your economy off of these out sized

balance sheets central banks are having a extremely difficult time doing that her remarks today suggest she's not in any hurry at all given the weak state of the european economy. >> it seems that they are in a bit of a pause do you think -- they've always said there needs to be a material deterioration of some of the factors they are seeing out there. do you think they'll be sitting on the sidelines for much of 2020 also because there is an election coming up >> you noticed okay i think the fed has stated very clearly that they are data dependent, which is another way of saying they don't know what they are going to do none of us do because to get the

answer to your question, you have to have perfect foresight with respect to the economy and inflation. under a baseline case of the economy inking out another year of 2% growth, which is lousy growth, i think they are pretty satisfied with where policy is you are entirely right as we move into the election season. they don't want to become the issue that the candidates are debating in front of the american public. doesn't mean they won't move if circumstances don't change dramatically the politics of a presidential election generally encourages the fed to stay on the sidelines. >> just a final question to you when it comes to central banking, what is the mandate

these days we know the official mandate looking at growth and employment as well. christine lagarde says we should be greener and worried about climate change isn't that a little too much aren't we overstepping our mandate here looking at all these factors. price alone is difficult to secure we are far away from 2% in many economies. >> that's a good point but don't confuse her legitimate concern as a policymaker with many of the tough issues that we face in the world from climate to inequality to trade she can use her position to focus attention on these issues. those are not mandates

the mandate is setting the policy instruments to comply in the case of the ecb. the mandate and the fed adds to it the sub text of your important question is price stability the right mandate when there is no inflation in the world should we be thinking about the different approach i think that's a very rich and fertile ground for a debate that should be held to target 2% inflation when you've undershot that for depending on the central bank between 5 and 10 years may be missing a more important goal, objective or mandate >> i'd like to continue that discussion we simply don't have the time. steven, you are going to stick

around a little longer and we'll continue to talk the u.s./china trade deal we'll come back to chris williamson, chief business economist. this is what we are going to talk about on the show still every day, chinese president xi jinping says he won't flinch in a trade fight. find out why in two minutes. sfx: upbeat music a lot of clothes you normally take to the cleaners aren't dirty dirty.

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>> welcome back to the show, the trump administration last week missed a deadline. politico has reported the u.s. can now consider an even broader investigation to trade practices under a separate kind of legal authority. any inquiry could prove odd for future tariffs they did not comment on politico's report and it is not clear which sectors or policies the u.s. might target under this process. chinese president xi jinping says he's secure and says china

is prepared to fight back if necessary. he said his country did not initiate the current conflict and said any agreement that is struck must be based on mutual respect and equality let's get back to our guest who joins us on line from singapore. before the break, you said the phase one deal had come into effect would of been a major disappointment what happens if we don't get one? the market is priced to perfection december 15 tariffs will come into effect? >> look, the markets are getting really tired of this endless on

again off again struggle over the big deal, the skinny deal. the phase one. the u.s. market has gone up very, very sharply over the last few weeks. if it seems likely that once again, another promise is being broken on the trade front. that leaves the market quite vulnerable to a reversal of the optimistic expectations. the december 15 round, you are right, was aimed at consumer products every time the u.s. president realizes that this is an issue that may have a material impact on a certain sector of theu.s. there is talk of deferring or

backing down i just landed in singapore but saw commentary on the fact that apple may get special dispensation that comes a day after the president celebrated his brilliant effort in getting apple to relocate a mac manufacturing plant in texas of course, none of that occurred it was a total figment of his imagination. that hasn't stopped him in the past and won't stop him in the future >> we appreciate your time and commentary this morning. steven roach senior lecturer at yale university. jeremy corbin has taken aim at bankers and billionaires.

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>> i was thinking of john lennon we should all be dreamers actually >> christine lagarde evokes the beattles star as she asks for time but defends the central bank's tim lus measures. >> the ecb policy stance has been a key driver of domestic demand during recovery that stance remains in place >> stocks stage a come back despite a mixed trade in asia. >> eurozone business growth almost hits a stand still in move after services sector grows by a weaker than expected pace >> some fighting words from the chinese president xi jinping he says he will not flinch from a trade war fight and insists a

preliminary or phase one deal must be based on mutual respect and equality we have those eurozone pmis. the one we talked about was so striking was business expectations on the service side lowest since june 2013 it will be interesting to see whether that spill over translates to the uk as well it will be interesting to see whether the manufacturing sector not nearly as massive but services is a key component here will be interesting to see how that factors into things when we get those numbers, we'll bring those to you as soon as possible chris, i want to ask you before we get to these numbers, what should investors be most focused on

>> it is a difficult thing in the uk there is an element of stasis -- >> so sorry, chris i'll have to interrupt you uk flash pmi, the lowest since july 2016. not great news the flash manufacturing pmi 48.3 versus 49.6. the flash 48.5 versus 50 the lowest since july 2016 >> consistent with staying with the gdp reading of negative 0.2% per quarter. sterling you can see falling to the dollar that seems to be do to the fact that it was lower than expected.

how concerning should that be for people >> this is really quite a concern. this isn't the lowest number since july 2016. it is the second lowest since early 2009 that 2016 number was immediately after a heart attack this is nearly as bad as that moment now by is very worried about the business outcome and election. everything is on hold at the moment >> just pure economic. >> hiring is dried up. you've had three months now of hiring dried up. that has been driving growth and

been encouraging to keep them on hold >> when things are in circumstances like this. you look at the economy in the uk, how quickly can it be turned around if some of that uncertainty and election is resolved is this something you can flip a switch and go back >> you've seen very quick reaction to policy changes and political changes in particular. if the business suddenly sees a better environment, we would see the numbers jump up. it is certainly not right now. even if you get a brexit deal come through quickly there is still a future amount in trading with europe in particular >> i just want to stick with the

volatility in particular what we saw in march and october artificially boosted the pmis. it happened. it will come back. in october, it was less than what we saw in march what do you expect for january how much of a boost are you going to see how used are they to saying there comes another deadline >> the october stockpile was because there wasn't enough warehouse space but i think there is fatigue setting in here it is expensive to build up these stock levels in preparation of the worse happening. i think there will be a case of businesses thinking, let's just try and risk this one. i think you won't see a big boost. >> thank you for that. chris williamson, chief

economist. the uk conservative party says it will raise taxes to 3% as part of the bid to win reelection the tax would apply to companies and individuals not residents for tax purposes the party could raise up to 120 million pounds per year. >> britain's labor party has unveiled its man ifestio promising to take on bankers and billionaires in what he calls his manifesto of hope. nationalizing areas like rail, and water an area said to cost 83 million pounds. >> we are seeing a bounce back from yesterday's trading we saw two or three days of losses

the dax up by 0.1 perls. the ftse 100 up by 0.1%. sterling lower after that miss on the pmi numbers the euro, and sterling here 1.2873 off by 0.3% the dollar flat after that miss on the eurozone pmis >> christine lagarde made her first high-profile speech and highlighted some of the challenges including a slow down in trade and echoed the sentiment on other speakers on the need to work towards a market union >> this involves moving towards a new policy mix which has a number of key elements the first and it is not because it is the only game in town. it shouldn't be.

the first is monetary policy it is my area of responsibility which will undergo a strategic review more later on on that. but give us time to actually do the work in a cohesive way >> sticking with europe, my colleague also spoke to the c e comerzbank >> he was saying that he was looking for a more integrated europe clearly if we had more of a common banking market, it would mean banks could actually make more money with the services delivered across the european union. that is all about integration, banking and supported by the recent proposal calling for the

common dooept scheme but a new thing for a german finance minister germany was always opposing that idea to have the common liability. having said that, i caught up with the ceo of commerzbank and what he thinks about that going forward. take a listen here >> i think banking union and more over, capital union will create a huge market and a huge level playing field that gives banks much better business opportunities than a fragmented market especially if you compare it to the u.s. banks if we really want to compete with our u.s. friends, we need finished banking union and capital market >> is it easier to do cross

border mergers if you look back 10 years ago, the discrepancy wasn't that big. u.s. banks were not that much smaller. now it is a completely different story. >> the reasons are a little more complex. it is absolutely clear, a banking union would give banks in europe the opportunity to create real european business models and franchises. as long as we don't have this, i don't expect that to be. that's not good. >> if you look at the different european markets, which markets do you think are most attractive if you think of doing business elsewhere. >> it depends on how you look into it. of course germany is because it is so strong economy, it is an

attractive market from business relevance. if you look at it from a margin perspective. i would see other markets which have much more juice i think of course the huge markets like germany, france, italy, spain and of course the others europe as a whole is important it is a question of the single market can we really use this huge market with the huge people as a market for the banks for the real economy as well >> that theme was more or less repeated by the new ecb president christine lagarde. she was also saying we need to have a more complete europe and

more understanding to be one big market in order to be successful it was much more political than draghi would ever have been and much less policy focused what was interesting here for that german audience reflecting on the side effects of the policy stands quite explicitly and telling us soon, we'll get a str strategic review it will never be a dull moment >> more beattles quotes and little more of a shake up. she even promised next year, her german will be even better in the final impeachment

hearing, fiona hill debunked a statement. urging to politically driven false hoods. holmes shed further light on the phone call between trump and gordon sondland. >> michael bloomberg has filed official paperwork to run for president. the billionaire previously filed similar paperwork at a state level at alabama, arkansas and texas but he still has not formally announced to run. >> at the women's forum in paris, the activist told cnbc that many key arguments against the new wealth tax were simply

not grounded in reality. >> if we are talking about elizabeth warren's 2%. if you have a billion dollars and you don't make $100 million every year just by sitting on your couch you are an idiot money just makes money it is one of the hardest things in the world not to let it grow. if it is a 2%, 3% tax, it will in no way inhibit your buying power and second of all the growth of your buying power. i don't understand what the hesitation is around a wealth tax. it in no way income bers a person being so far pass being able to send that money. >> disney also said it can be difficult for female

entrepreneurs to raise capital at the moment. >> the finance business has sort of priest class because it has gotten more obscure. the more male it tends to get. so the decisions that get made aren't made with everyone in mind, which is not to say men can't make decisions that are perfectly wonderful but they don't always see all of it and that's why women are so important and other minority groups >> that was the granddaughter of of disney talking. talking about the recent high-profile criticism of the goldman sachs apple credit card. >> now the al gore rhythms are

written to be very logical and assessed on historical data built in an environment built for men, we are seeing it get worse. i think there will be tweaking because it is well discussed that algorithms can be biased. businesses can look at themselves and say, listen, women make up half the population in the world and are becoming increasingly wealthy. i think there will will be a business driver and regulatory driver >> coming up, will the current ipo slump continue we'll have the ubs mb join us with his oloutok on the year ahead. pharmacist-recommended

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>> welcome back. reuters has callen on a number of calls to coty

the news agency reports coty will launch an auction process to find a suitor for its hair and nail care including wella and carol. they jumped on the news but ended a percentage point lower you heard yesterday that charles schwab is in process to buy td ameritrade that represents an 18% premium before the deal was announced. larger dealers have discussed pressure to cut their commissions. many have reduced them to near 0% shares closed thursday session sharply higher on the back of that news. >> ubs says it expects equity issue ens in europe to remain

depressed. tech is expected to remain the big ticket of the ipo market let's talk more about this outlook for 2020 with our guest. great to have you on the show. there is this clear die cot my of the issuance and the record highs. how do you explain that? >> i thinks it the late cycle where investors are being very selective. ipos that offer yields, they are well received. >> you say it is selectiveness on the investor base and maybe part of the competition in terms of debt financing. to what extent does that play a roll that low cost of debt you are talking about is driving asset allocation and index

performance. the fund managers are struggling to perform you said before, global tech up 30% year to day. you said this could be one of the better performing sectors. we have seen ipos in the u.s. that haven't performed as well they've been lagging uber for example how do you explain that? that one sector through disruption or innovation you are right, actually in the main, that is a sector that is delivering growth and attracting the global markets >> you are seeing a lot of large high value deals go through but not such consistent volume what does that mean for banks

looking to earn fees >> it is tough the feed pool for europe is pretty much at decade lows that is translating to large liquid deals getting done. the rest not as we perform to 2020, we hope some of the political instability should normalize and drive some of the pick up in the uk and volume. >> mentioning that in the past years, what they've meant, what about the rise of passive vesting, what does that do in the market base? >> that is shrinking and as a result, that takes the bar for the successful ipo to really be attractive to either hedge funds looking at this or the remaining active managers who really can look to participate in the

interesting stories they can't get in the secondary market. >> i saw an interesting story. world chess has announced a h h hybrid market will be issuing a digital token? >> is that going to be the norm? >> no doubt, there is a lot of innovation look at the direct listings happening in the u.s we are still in the experiment al phase clearly as technology evolves and mandates evolve, there will be scope of different ways of things we should look at the more normalized process with specific examples that might be different from the traditional process >> thank you so much

managing director at ubs let's keep you in touch with the markets. we had a lot of movement this morning with the pmis coming out. many disappointing specifically the ones for the uk economy. sterling/dollar down about and trading at 1.2870. that was below expectations. the lowest print since 2016. the german and the french pmi numbers on manufacturing side were better but then came the composite one specifically services side an those missed expectations and that sent the euro a little lower. european markets, we should also be looking at. we are seeing a big bounce back

and reversal here as risk appetite is coming back. the ftse 100 up more than 1% or 75 points. we are seeing basic resources or material sectors doing much better, so recouping some of the losses they were all will how the trade deal was going to go through very little optimism is happening now. some buyers coming back into the market the dax up 0.2%. the cac also showing some gains. what about the u.s. market >> we did see the longest streak in the dow the s&p 500 being called up around seven points there. the dow being called 56 points higher at this stage and the nasdaq there, again, looking to trade up slightly stronger this

morning once the market opens in a few hour's time by around 27 points tez law has unveiled one final story unveiling the pickup truck with a starting price of $39,000. the truck is set to enter production late 2021 the ceo says the truck will not scratch or dent and windows were made of armored glass but the windows were smashed during t eierhank you for bng he. "worldwide exchange" is up next. e next mozart. as usual we were behind schedule. but sophie's enthusiasm cannot be dampened. not even by a run-away donut.

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>> it is 5:00 a.m. at cnbc global headquarters. here is your five at 5:00. the dow risk a four-day winning streak. >> and xi jinping says a phase one deal seems less than likely. >> vaping under fire president trump holding court as one major u.s. city looks to ban flavored