that's all for this edition of "dateline." i'm natalie morales. thanks for watching. [music playing] good morning welcome to "street signs." i'm julianna tatelbaum these are your head lynns. the stoxx 600 turns negative chancellor merkel says the outbreak is only just beginning. unileaver drops to the bottom as a scrape outlook

credit suisse posts 75% increase standard charter ceo tell cnbc the pandemic could still negatively impact the sector despite the early resilience >> the shock we are experiencing in the first place is as severe. as this pandemic unfolds and we won't know exactly or generally how this will progress, we have to suspect that impact is very, very material. the pope extends a prayer for european unity but divisions are expected to still dominate eu leaders go on line in a video conference meant to talk about further assistance to fight the pandemic a crude comeback buyers rush back sending u.s. oil prices up almost 40% in

overnight trade. surprising tensions between u.s. and iran also supporting the price. welcome to "street signs." let's kick off the hour with fresh eurozone pmi numbers we have heard of the french and german numbers now for the eurozone as a whole. the april composite pmi flash number has come in at 13.5 that is much worse than the market was expecting we were looking for a number around 26. a severe downturn. the pmi has come in at 33.6. the services sector, this is where the bulk of the weakness

is coming from, the april services pmi flash estimate is 11.7 that is much, much worse than expected the market was looking for 25. a very steep step down from march. worse than the analysts had been expecting. the euro is trading weaker down about 20 basis points. the market already pricing in some of this more negative than expected news from the pmi let's bring in chris williamson, producer of these surveys. chris and geoff are also with us these numbers are pretty dier. the market had been expecting significant step down but this is even worse than they had feared where are the pockets of stress? >> good morning. markets of stress absolutely

everywhere you look at the survey it is an all-time low. these surveys go back to 1998. you've got 22 years of history here nothing like this seen before. the decline is far steeper than the financial crisis the levels at the moment for the eurozone signal the rates approaching about 7.5% this is really steep during the financial crisis, you have the decline around the 2% to 3% mark so you double that this is everywhere these vary between 100 to 150 being the change bar in some sectors be it hotel or others hit by this pandemic in the containment measures these were close to zero as

these whole sectors effectively shut down, no business being done at all. it is wider than that. right across the board the headline pmi 33.6 for the eurozone that index is boosted by some components with delivery times which contribute very positive strip out and look purely at the manufacturing output index which manufacture the trends which were down 18.4 down 11% reading against services even when manufacturing is down on its knees this is a low in manufacturing as well. >> chris, inevitably that was going to be bad data on the back of an unprecedented demand shock

here what is interesting to me, is going forward how effective national and international support measures are to keep companies alive and to keep workers in jobs. how optimistic or otheriwise are you to support workers and keep companies in business? >> i can't say i'm optimistic. whatever measures are implemented here you've got to remove from the system in terms of the gdp and employment collapse. we are already seeing job losses at an unprecedented rate in this survey despite government policies and other measures to furlough and keep them on the

books. job losses are going ahead as companies are looking at this entrenched downturn. people aren't going to be willing to step back into life the same way they were before due to their own fears of catching the virus people are realizing that this isn't a one-quarter downturn here this is something you've got to hunker down and get through. this is really important keeping business alive whole sways of business will try to get through this. not just with loans but with capit capital injections huge costs being incurred while

businesses just aren't doing business here. you've got the cost here but you have not got the revenues for some time. >> let me follow up. do you think that this bottom represents the bottom or will the new number we get in may be even worse there are countries that are beginning to talk about easing lockdowns. they are coming up with face masks and testings and other measures to try to allow gradual recovery and perhaps a pickup in demand do we base here? >> i think we base here. you think about how these pmis work they measure month on month changes. we saw a vast majority of these

he measures implemented in april. so this is when the big collapse occurred if you think about month on month changes. if you have 100% collapse in output. if you stay at that collapsed output in may, it is the same. we will probably see the pmi start to rise 50 or there about in the next couple of months as the slow down at these low levels we will then inevitably start to pick up a little we'll need these indices to arrive much above 50 to see

signs of any real recovery index levels of 70s and 80s to recoup the losses you've seen here those numbers don't look feasible for some time to come if we've got these measures even relaxed permeating through these economies which seem inevitable. >> i've been out on the streets of london. no doubt about it first three or four weeks, absolutely dead zone certainly this week, i've noticed a lot of active. a lot of construction. i've seen them coming up from houston and cross rail are things beginning to happen across the continent before the formal end of the lockdown as such, should we find that as a basis of some form of optimism >> yes absolutely these measures should start to

leave and numbers should start to improve but it is going to be gradual. the prospect of recouping the loss now down even a couple of months, eem unlikely in any short-term period. we will see things come back to life that will help. q2 even for april should be the low for europe and indeed globally we've got numbers coming out for the u.s. later today they'll be hugely interesting to watch. we've already seen signs from asia that suggest the worst in terms of the downturn have passed our hopes is that things will be improving. the idea of this ferocious downturn with the gdp that we saw in the

global financial crisis. to regain that level of output is a rough call. >> thank you for joining us. nice to end on a relatively high note but a rough road ahead. another key focus is that european submit taking place leaders will hold a virtual submit where they are hoping agree on a economic recovery plan however member states remain split on how funds should be split and raised as germany and negligenter lath reject any sort of fund. ahead of this high-stakes

meeting, what are the chances we actually get something substantial agreed today versus what we have seen time and time again of kicking the can down the line and promise to hold more talks in the future >> the expectation is to see a full decision on how the recovery fund is going to look like, that should be put aside there are three question marks our needeleaders need to deal w. how big the recovery fund should be if it should be made of loans, grants or both and what sort of instrument should be used to get this new capital these are very difficult decisions leaders need to take however, having spoken with different officials, we could see some political agreement on one of these aspects

let's say the leaders actually agree on the instrument and say that the recovery fund should be part of the wider eu budget that could potentially be market positive because that could tell us about where this recovery fund is heading. if we see no sort of agreement, that could be market negative and could have implications as well let me share the numbers with you. when we talk about european solidarity and why certain countries are asking for help. a think tank looked at all the different pledges, when you look at the conclusion of the study, you can see germany has announced more than half of the 2019 gdp in fiscal stimulus. on the other hand, italy has

announced only 20% of its 2019 gdp in help. certain countries have the fiscal capacity to deal and others don't this is why they are asking for more help at the eu level. let's see if they will get it later today. >> sylvia, thank you we'll all be watching that submit meeting we'll squeeze in a quick break when we come back, a warning bank space is, quote, severe shock. more after the break ♪ at cdw, we get that trying to simplify data storage can get very complicated. but cdw will assist your needs and implement a dell emc unity xt all-flash unified storage platform. it delivers speed and efficiency, while providing simplicity and flexibility. for unified storage platforms, you need dell technologies, and it orchestration by cdw.

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welcome back let's get a check on european markets. they've been trading just over an hour. the majority are in the red. france just a touch below the flat line. italy bucking the trend. interesting to see italy outperforming on a day when the european council is sharply in

focus. watching to see whether leaders can agree on how to move forward. calls from solidarity from angela merkel. we have some pretty business mall numbers showing a sharp contraction. france barely in double digit territories. giving insight just to how severe this will be. speaking when it is not hard data but it has cast shadow over the sentiment this morning let's look at the different sectors. fairly evenly split. oil and gas rebounding that sector is up about 4% we have seen a rebound with investors putting money back to

work u.s. oil prices rallying as much as 40% basic resources up this morning about 80 basis points. household goods, media, construction and retail round out the bottom part of the market in auto space, renault posted a 19.2% drop in sales in the first quarter as the french carmaker saw the coronavirus hit demand and lead to plant closures demand up higher sharply outperforming the broader market charlotte, weigh in what we heard from renault this morning. i know investors were concerned about renault's balance sheet strength is that part of what is driving shares higher this morning >> you are right, julia. no surprise from the q1 results trying to reassure investors on

the liquidity fund they mention a credit line of $3.5 billion as well as $10.3 billion in liquidity they have asked for a guarantee loan in the future that they say should be in place by mid-may. they have confirmed the number around $4 to $5 billion euros that could come into play. so confirming these thing should come by mid-may. they have mentioned and as part of this deal getting the aid that the french government is 15% aid. announced and confirming that the dividend at renault has been scrapped confirming they have been able to ride the storm. the new start has been difficult after the arrest of the former

ceo carlos ghosn it is supposed to be the new start. they have confirmed that by mid-may, they have announced a $2 many ill $2 million savings plan. they are flying blind as to when production will go back to normal showing positive that they are still working on the plant and showing that they have the ability to ride out the storm. shares are up 2.5% on the french market >> thank you for that report sticking with the autos, daimler has warned by a first quarter sink up to 70% you can see daimler shares are holding up up about 0.7%. underperforming in the auto pace let's get out to annetta with

this story from frankfurt. it seems as if the share price reaction was already baked into the price. what more can you tell us? >> caller: that's exactly the case it seems investors seem to be quite stable they have that credit line today, we are reassuring investors of the liquidity to get through the crisis and that they think they are in a good position to weather the storm and restart successfully after the crisis is over talking about restarting their production on monday as the majority of their plans. demand for their vehicle is still low. demand is around 15% we can always speculate the

first quarter. because the demand in europe being more or less locked down people are not going to buy a lot of cars especially in the luxury sector. in terms of guidance, there is no clear guidance. they are skipping their guidance and just saying sales will be below last year. already last year was a very bad year for daimler to give you an idea of how bad 2020 will be of course daimler has the same problem like everybody else, they can't forecast the situation or when the economy will reopen and how much damage

has been done. the worst was already baked in the share price. now there is certain relief it might not be needing state aid, at leave for now >> listening to both you and charlotte, liquidity is the name of the game. perhaps that is what is boosting the consumer goods giant expects to pay out the quarterly dividend making everything from ice cream to hand sanitizer is adapting, quote, to lasting changes due to the pandemic >> taylor wimpe yerch with plans

to return to house construction. site closures due to coronavirus has impacted its total completions. >> if you look behind me, can you see a construction truck going past that is the exact point of the uk economy they appear to be getting back to work in some way. we'll discuss. uk economy we celebrate shakespeare's birthdayknown as st. george's day here in england.

welcome back to "street signs. these are your headlines the stoxx 600 turns negative as your -- eurozone activity moves. >> translator: nobody wants to hear it but it is still the

truth. we are not in the final stage of this pandemic. we'll have to live with this for a long time. >> credit suisse among exceptional levels of activity bill winters tells cnbc the negative impact despite the sector >> the shock we are experiencing in the first place is at least as severe. as this pandemic unfolds and nobody knows exactly or generally how this will be over the next 6 to 12 months. >> unilever scraps its outlook among warning to changes of buying behavior. the pope extends a prayer. eu leaders hold their video conference today to agree on the economic recovery plan

we have some fresh data now just crossing the wires this time from the uk. these are april pmi numbers. for the uk, the composite has come in at 12.9. that is versus march at 36 that is also a new record low. in terms of the break down between the services and manufacturing, services no surprise there the key weak point that figure has come in at 12.3, manufacturing pmi at 32.9. similar trend to what we've seen in france and germany so far this morning so very, very grim numbers the manufacturing pmi output

all in all, a very, very grim set of numbers on the soft data side of things for the united kingdom you can see there sterling relatively unchanged against the dollar up to 1.2340 we did see reaction this morning on the back of the french and german numbers investors now with a chance to digest we've seen a little strength coming up about 11 basis points. let's get out to steve who joins us now geoff is also standing by. steve, these uk numbers, what we would expect, very grim set of figures. interesting remarks you made around the construction industry in the uk, actually some is signs of hope when it comes to that part of the economy and

putting it all together? >> let me show you some pictures over my right shoulder here, mike is going to show you something. all right. it is a truck. hold on a second the construction -- i am biased. this is the finest arena it is lord's cricket ground. they are building and carrying on with activity i know lords is carrying on good social distancing. i have seen a mass of trucks come across here that one there, look it is not me making it up. whether they are coming up from houston on the hs 2 project back up and running coming from lords, i can tell you, what i'm seeing with my eyes would you say, don't just look at the balance sheets. get out there as well. i can't tell you that the data

is going to show you some massive rebound or that the uk economy is doing anything other than flat lining a vast trough of people sitting at home not knowing what to do this morning, my cameraman and i have been out here and seen dozens and dozens of construction trucks. that is not a full lockdown. there is activity going on albeit a lockdown going on we have got to keep it going in order to defeat coronavirus and not get a second beat. all i can tell you with my own eyes, i have seen dozens and dozens of construction trucks. over the last couple of weeks, they were doing nothing. wondering if mr. sharma or someone else from the government can tell me of an explicit

situation where they'll get back to work. another thing. a construction truck another truck. i'm not making it up it is an anecdote. i wanted to share it with you. geoff? >> that's an important point, steve. another thing to comment back to that point about which the pace at which we come out of the lockdown i thought it was very interesting to see andrew bailee on the wire issuing a note of caution. there are a lot of questions as to the nature of the relationship between the treasury and the bank of england these days when we look at any country, can we continue to argue that central banks are effectively who they work for.

i thought it interesting that he is getting involved in the discussion and the fact that he's saying, look, let's not be too hasty here and try to get economic activity coming back too quickly because there is always the risk of that second or third round of the virus. then immediately, we are all dashing back that will only be worse for encouraging demand back into economy and try to establish a sense of normal si i think there are very sensible voices out there expressing caution. back to the point i made earlier on about the eurozone data inevitably, the data is going to look horrible for april. i was quite incencouraged by th remarks by the ihs market where he said he feels this may be a

bottoming rather than a step down in may and then ultimately in subsequent months >> do i have time for a very quick comment? geoff, do you remember last year, that beautiful place behind us. i think this is as close as we are going to get this year >> yes i think our only choice will be to watch some of the matches from previous years on television >> to be fair, we didn't watch too much cricket last time, did we >> my mouth is shut. >> i look forward to hearing those stories potentially off camera let's check the european markets coming off the lows for the day. despite those comments suggesting we could be seeing the bottom when it comes to these numbers.

you've got the uk and gefrm an industries still forward let's get a quick check on sectors. we have seen a bounce in oil and gas and now trading 1% higher. real estate and banks round out the top of the chart household goods under pressure down about 80 basis points chemicals round out the bottom that pivotal council meeting will be a critical moment for investors. we'll look for any comments around that when it kicks off later on let's talk some of the key markets in focus credit suisse has reported a drop to $1.3 billion swiss franks amid exceptional levels of client activity helped counter the slump in deal making and credit losses. the banking giant cautioned that performance could be negatively

impacted by the coronavirus in the coming quarters. it may have to bull sister further if impairments rise. the economic shock from the virus will be more severe than the 2008 financial crisis but the banking system is in a better position than a decade ago. that's according to stanchart ceo bill winters >> the shock we are experiencing in the first place is at least as severe. i'll say as this pandemic unfolds, and none of us knows how this will progress over the next 6 to 12 months. that this is going to be very, very material. the need has never been greater. >> this has been a torturous journey since the financial crisis to build up reserves.

this is a rainy day what the banks have been saving for as soon as we get out of the crisis, banks have to restore those levels talk us through that is this the time to raid the bank and shore up those clients? >> i think we are. there are natural mechanisms like corporations have been undrawn. to some extend, they've been drawing those down we know that financial markets have been extremely volatile that creates the position and increase to capital. banks are doing the right thing. often times together with their government using the balance sheet to support those that have been effective but going through a difficult time because their business has been impacted

we'll see a natural extension. people see downgrades. the capital itself is calculated as companies are downgraded or credit becomes stress, the risk-related assets or capital will go up there will be a number of automatic steps that will increase capital ratios. >> switching over from the financial sector to luxury watch industry is appending positions. major leaders will skip the baselworld others are considering going it

alone. they've lot of half of the market cap and will make discussions on the fur tur of the event in the coming weeks. dropping to $1.6 billionfranks as the pandemic has hit luxury goods demand high end watches prove more resilient. while demand for cheaper watches halved thank you for being with us. i'd like to kick off with what is going on in china the number one question for luxury investors is how that reopening of the economy is going. it is not only a major market for luxury but also one of the only major markets that are open are you seeing an improvement? is. >> absolutely. so there is a light in the

tunnel china reopened approximately four weeks ago, also taiwan, korea and many more european markets. we saw after sars and after the financial crisis that there is a rebound in consumer consumption. people were frustrated the beauty is that you can actually postpone purchase what you cannot do if you are a restaurant or airline, you cannot postpone a seat what you lose today is lost for the year we can hopefully catch up a bit of what we have been losing over the past two months during the course of the year >> are you expecting to see the luxury sector regain all of its lost ground. compared to a hospitality

business where people cannot make up for all that they've missed some of the early data suggests that consumer behavior and services are changing so we won't have that full catch up. absolutely what we don't know is how the consumer will react. other values will be important like how sustainable is your company new values what i would call after corona values how sustainable are you as a brand, how meaningful. i think there will be new values also for the watch industry, are you carbon neutral all of these elements were probably less important started to raise with the young

clientele wi clientele will accelerate after corona >> i know you went through a phase of plant closures and the with reopening where are you in the process? >> we closed manufacturing facilities nearly three weeks. we reopened them last monday but gradually for several reasons. first of all, we can produce only towards the increased demand in the reopened markets the second thing is, of course, we have to be careful and make sure our colleagues are safe in the manufacturing sector so we work in shifts and hopefully all of this will get normalized in the next coming weeks. >> just in terms of the outlook

on the export side of the business here, how much worse do you think it may get >> that is a very difficult question, i would love to know the answer the collateral damages are much, much stronger than the financial crisis the impact of unemployment and there for consumer sentiment are very different we don't know what is going to happen many of the luxury companies did serve on a waiver and it does serve as a market share. it will be tougher for everybody. >> i understand you guys have had to switch your strategy when it comes to launching new lines. you launched a virtual event

that takes the place of the usual event. do you think this will stick once coronavirus is passed >> it went really well it was cost effective. we had more coverage and response than any week obviously people were confined at home and had a lot of time to watch the news and our presentations. i'm convinced though that at the end of the day, people want physical contact humans as we are, we want to enjoy life, go into stores, experience the brand, see, touch the product. yes, you can be digital, at the end of the day, it's a physical experience >> absolutely. something we all look forward

to thank you for being with us. ceo of breitling oil output in the u.s. plunges ahead of crude prices. more on that in a few moments. [♪] think you need to buy expensive skincare products to see dramatic results? try olay skin care. just one jar of micro-sculpting cream has the hydrating power of 5 jars of a prestige cream,

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. welcome back to the program. ir iran says it has launched the first ever satellite into or bit raising sanctions with the u.s the pentagon has not confirmed whether the satellite is operational. mike pompeo condemned the launch president trump tweeted he had ordered the navy to, quote, shoot down and destroy any and all iranian gun boats if they harass our ships at sea. a report that 11 vessels came close in the gulf calling the move dangerous and provocative

an iranian spokesperson said it should focus on saving its military from coronavirus. markets have bounced from tensions brent now 7% higher back above $22 a barrel mark. from the june contract up above $15 a barrel u.s. oil producers slashed output by 900,000 barrels according to the eia data also shows inventory rose to 15 million barrels a date putting the stockpile at a record high. the demand pushed crude prices to record lows it has been a volatile week for energy to say the least. looking ahead to investors, the u.s. unemployment picture is

said to have improved a bit. 4.3 million americans filed for unemployment down from 5.2 million from the week before. around 22 million have filed jobless claims in the past month amid the coronavirus in washington, the house of representatives is expected to approve the nearly $500 trillion stimulus package president trump has seemingly changed his tune on states reopening warning georgia's governor it is too soon. state leaders remain widely divided on plans fragmenting into like-minded coordination for reopening going to tracie potts now from washington, d.c. it feels like the signals from washington are pretty mixed.

how should we think about the reopening of the u.s. economy? >> well it depends on who you are and where you are. president trump said 24 hours earlier that he supported whatever brian kemp did for his state, for georgia then the next day, he said he not only disagreed but strongly disagreed with kemp reopening nonessential businesseslike hair salons and movie theaters that he would leave it up to the governor but that he thought it was too soon this is an about face within 24 hours. there has been a lot of criticism of georgia reopening some of those nonessential businesses including within the state. mayors saying they were blindsided watching closely today the house

vote which should give final approval to the coronavirus stimulus package that would include billions, over $300 billions for small business loans. replenishing the paycheck protection that we saw run out a week ago they have built out provisions so more real small businesses get the money. one of the criticisms was that very large companies that had locations all over the country could apply individually and get these small business loans even though they are large corporations this is now so more of the mom and pop stores can get the help and get workers paid >> thank you that is obviously very crucial, the small businesses in the united states, really the life blood for the economy. thank you for that tracie potts joining us from nbc

news in washington let's check on the futures we are looking at a weaker start to trade here. after the rally, with he saw markets close higher but remain negative week to date. that jobless claims report that we were just discussing. looking for 4.3 million americans to have filed for unemployment benefits. slightly better than the week heirlier when a.r5.2 million fi for benefits i'm julianna tatelbaum thank you for watching xtxcng cesp hae"om u ne save hundreds on your wireless bill

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. treasuries saying it will, quote, grow in the week. sto stock futures not responding oil at $15 a barrel. >> president trump pushing against georgia's plan to reopen the economy as soon as tomorrow. >> is the supply chain at risk another facility closing down. >> another airline trying to slow cash burn by issuing more debt will it help when 97% of us are no