lucy macdonald, my guest host globalrning from allianz investors.s just gone 10:49 here in dubai. jp morgan is warning the coronavirus may worsen trade conditions for one of the most the good assets, u.s. treasuries. they say overwhelmed banks could be flooded with next to $300 million worth of u.s. government debt. that could pose a challenge to the repurchase markets, a vital part of the financial system. 100 37lans to create billion euro asset management and a growing demand for , al estate and other assets french insurer dividing asset management businesses into two businesses for an alternative unit. the latter will been together his real estate arm and structured finance. he expects a substantial loss in 2020 as coronavirus outbreak hertz travel demand. the challenge faces the carrier after it battles to the hong kong protest last year, the warning comes after it cut its net income under 28% for 2019. that is your business flash this wednesday morning. coming up on the show, pressure building for the ecb to act tomorrow, your morning call. wha

allianz under pressure. peripheral markets being hit very hard as well.also have some shortselling bans in place in italy and spain. let's break it down from a sector point of view, show you where the market is attempting to hide out. half of 1%n by only today. miners have had a better day. utilities are there on the bond play. down. is you really need to look at the balance sheet. there could be opportunities. car sectors down as well. let's go through some individual names to highlight what we are seeing. has lost a quarter of its value today. this is british airways, aer lingus, or whole bunch of carriers across europe. basically, we have seen consolidation. allianz down by 13% today. pay attention to the banking sector. down by 14% today. that is a name that many of us will remember from the great financial crisis. alix: it is a similar story here in the u.s. could have been worse, down by 7.4%, but we were down by 11%. we are off the lows, but it is the financials, energy, material stocks getting hit very hard, even though the fed did step in. maybe

cooper andis laura neil duane at allianz global investors.on't know how you would describe the markets. they are struggling with the fact that it feels like the economy has been strong and yet panicking. i think the markets are trying to work out what the fed has i've's -- but also i would say they have got the bit between their teeth. to giveets are saying them more rate cuts so we could see a move in march which would tell us the economy is in dire trouble. francine: how do you explain the selloff? the fact that it the statement that they were in for action provided a shock to markets. we did see a significant tightening in financial conditions that warranted some kind of action. reason we saw what we saw an equity markets was because of what powell said in press conferences. we have yet to see the full economic impact in the u.s.. francine: what can banks do at this point? they are keeping liquidity and credit available to the supply chains and companies being affected. the cost of money is irrelevant at this point in time. yourself ife to

we bring back mohammad el-erian, chief economist and market guru at allianz. you said we are going to have pockets of illiquidity and market dislocations. you also said just don't trade at the moment. just wait. now, you appear to be right on both fronts. what do you see now? >> so liz, i wish i could tell you that i see calmer waters in front of us but i do not. waters are going to get even choppier. they will get choppier economically. i shared with you this notion of economic sudden stops when everything comes to a halt in a way we never expected. they are going to come -- also come under pressure because we have a lot of forced selling that hasn't gone through yet. you have a lot of track longs, a lot of redemptions going on from etfs and mutual funds. i'm afraid it's going to get even more treacherous in the next few days and weeks. liz: well, i was looking at some etfs like hyg and j & k, junk and high yield, and you've got to tell me, do those reflect anything that is disconcerting? hyg down 3.5%. it was lower earlier by about 5%. tell me what our inves

it was surreal atmosphere in the allianz, with no fans in attendance. juve won the match 2—0.lt sees juventus go ahead of lazio by a point, inter remain third. and in rugby union, france's grand slam hopes in the six nations are over — they were beaten 28—17 by scotland at murrayfield. france had won their first three games, but a first—half red card for mohamed haouas allowed scotland to seize control running in 3 tries, two for sean maitland as they recorded a fourth successive home win over their opponents. france remain top of the championship, but equal on points with england. after man city's defeat, third place leicester could move to within four points of the defending premier league champions. brendan rodgers' side are home to second bottom aston villa on monday, and could have jamie vardy back following a calf problem. both sides haven't won in four league games, with villa losing all of them. olympiakos and wolves will hold talks on monday with the prospect of their europa league round of 16 first leg match being played behind closed doors in greece. it's set to tak

allianz' chief economic advisor says the bank of england showed the path to start dealing with the global u.k. could manage to punch well above its weight on financial issues. they might have lost the reserve currency status, they may have had a little bit of brexit, but they know how to give swag when it comes to policy response. what did you make of the double barrel? smoking? kokou: absolutely. --s is one of an interesting both having monetary and fiscal acting at the same time. the u.k. has been running through more of an austerity program from the fiscal front and it is interesting to see how quickly it was able to switch into more stimulative package on the fiscal front. clearly this is something markets have been expecting, and the issue is brexit. at the end of the year, whether the u.k. could manage this is another risk. manus: we will pick it up very shortly. we talk oil next. ♪ from: good morning bloomberg's middle east headquarters in dubai. charge.s are in global stocks fall as the u.s. president announces travel restrictions from europe to the u.s. for 30 days. he offers no

on the markets, central banks and what governments are doing, joining us is the chief economist at allianz. we've had a lot of noise -- news. stimulus in the u.s. the fed unleashing everything. btm's.b buying what is your take in last one for hours? >> one thing for sure is whatever it takes does not rhyme with however it is named. it's important to understand that from country to country, between treasury and monetary policies, there is a huge difference in the ways policy actions are taken and coordinated. you mentioned before the european issues are complicated. there are rumors but there is a what -- priority given to type of relief it can give without condition and showing off its power. the opportunity to do more, the outright monetary transaction, the corona bond. markets to be so volatile in the short run. slowly but surely pricing is locked down. there were a lot of measures taken towards companies to break the cash flow crisis. mitigate totally the severity of the recession of closing down shops for three months in an economy like the u.k. what is interesting is the policy action

we had mohammed el-erian of allianz last week saying watch out, not only are you going to start seeinge liquidity issues, but i have been hearing that banks are becoming way more conservative in their lending, they are really scrutinizing the people and the organizations and the businesses to whom they are lending. is this going to freeze up? >> well, it's not going to freeze up 'tin the banking industry because as i said, if you have over 22% of the assets of this $13 trillion industry in cash or treasury securities, there is no liquidity problem. obviously, there's a fear on the part of bank managers that we don't want to make loans to people who aren't going to work. we don't want to make loans to oil companies which are losing money. we don't want to make loans in a variety of sectors that are being challenged by, you know, the inability of people to buy things. so they are pulling back. but they are just overwhelmed with liquidity. i'm preeting a irepeating but y a trillion dollars. that's a lot of money sitting in just one bank. if you take bank of america and put it with jpmorga

. >>> later, we'll be speaking with allianz's chief investor.ake a look at the faang stocks gains of 3 1/3 to 3 1/2% we'll be right back. love to give ♪ ♪ i've got so much more to give, baby ♪ to start your retirement plan, find an advisor at massmutual.com [sfx: mnemonic] doprevagen is the number oneild mempharmacist-recommendeding? memory support brand. you can find it in the vitamin aisle in stores everywhere. prevagen. healthier brain. better life. >>> all right. welcome back to "squawk box," everybody. the futures decidedly higher than they had been yesterday we're off the highs of this session. we had been watching the dow futures up by over 1,000 points which would have made back about half of the losses that we saw yesterday. the dow futures are up by 755 points s&p futures up by 82 the nasdaq up by 248. >>> a few stocks this morning. shares of dick's sporting goods are higher they reported quarterly earnings of $1.32 ten cents above estimate 13.7% increase in the quarterly dividend look what it's done though that's a rebound from where

this was the allianz stadium last night forjuventus against inter milan — a huge game in italian football empty for ac milan against genoa. it's the last we'll see of sport in the country for a while — the government has now suspended all sporting events. it's a different story in england — matches continue in the premier league, but handshakes are out. instead players just walk past each other. of course they do then go and play 90 minutes of what is a contact sport. if you people are asking whether thatis if you people are asking whether that is particularly logical. —— matt a few people. formula one's caught up in this too. it's already postponed the race in shanghai. and the bahrain grand prix will go ahead in a few weeks — but without fans. the australian grand prix is still scheduled for this weekend and fans can come. so different rules in different countries. here's the organiser of the race in australia. every country around the world is going to be having their own approach, from a health point of view. they are taking into account health circumstances locally, the history of th

coming up in the next half-hour, allianz chiefan, advisor. ♪ viviana: you're watching "bloomberg daybreakh your bloomberg business flash. apple.n with it kept its business rolling through the coronavirus pandemic by launching a new ipad pro. that does not mean it supply chain is in the clear. next week, deliveries will begin arriving on doorsteps but bloomberg has learned production of those devices likely started in early january. we end with teva pharmaceuticals planning to donate 6 million of malaria tablets to help u.s. hospitals. by presidenttouted trump is potential treatment for coronavirus. the israeli company is one of the world's largest producers of the drug. that is your bloomberg business flash. alix: thanks so much. i want to thank michael mckee for pointing this out. apparently ohio initial jobless claims right now are 139,000 from sunday to thursday versus 4800 a week ago. badgh frequency on just how the unemployment rate will be. 2 million unemployed. not great. it is time for bottom line. we will look at companies worth watching this morning. today we will focus on the h

joining mar for her take on the markets, mona mahajan, allianz global investors.u have a risk on bid today. on the other hand, you still have economists saying this is going to get worse before it gets better, but we are not there yet. so how much risk do you take on in that environment? thanks,alix, and thanks for having me. in terms of the risk on today, keep in mind in bear markets historically, we have had rallies, and substantial rallies. really, that has not indicated a bottoming process. what we think we need to see in terms of getting to a bottoming process is to first address the health issue. we will first need to see stabilization and a plateau in the number of cases in the u.s., but we will also need to see or start to get signals of a viable treatment of this disease before we can really get the all clear. college ofom the london last week that essentially come of the social distancing we have on right now will have to remain in place in some form until there is a vaccination or antiviral therapy that can be distributed to the broader public. i would

this tricky period >> looking forward tw to thoo t interviews first, chief economiced a vie or at allianzll with us, josh brown top of the show, it had been encouraging to see the fact that today's trade saw the market shake off a couple fades earlier in the session i guess that doesn't apply now with that loss pullback, albie wit dow still up 10.5% so far this week. >> right no, it doesn't necessarily quite apply. it was looking like a very solid followthrough day to the upside around midday, midafternoon, but i do think it does underscore the way when you have these very high-stress markets, under a lot of pressure, steeply down in a short period of time, you want to call it a crash or a bear market, most rallies tend to be, you know, take within a grain of salt i would say aside from the d.c. news we did get, there was a report that hit the tape that perhaps apple is going to delay the launch of its 5g phone i don't see that as being terribly surprising but it reversed apple and the nasdaq. it more was a measure of how skittish and shallow traders' convictions are around this tape as o

let's bring in allianz chief economic advisor former chair of president obama's global development counsel morning. first off, you have been making headlines looking at the stock market today. you said while a bull market could eventually continue there could be further selling to come. why? >> because the coronavirus is doing two things that a very unusual. first simultaneous destruction of demand and supply. you see it in the airline industry. we travel less. they take out flights, lay off people. what does that do? reduces it further. the second , fear, fear causes paralysis, causes uncertainty and causes risk aversion. put these two things together and we're looking unfortunately at a major slowdown. it is a good thing the policy response is stepping up. >> sandra: is a stimulus needed for the economy based on where things are today? >> what's needed is to follow what you are seeing coming out. the signals. a, we need a multi-stage approach. b, it needs to focus first on timely and targeted measures that address the most vulnerable segments and individuals in our economy. three, it has

allianz chief economic advisor, mohamed el erian will you come out when it's time and say, all clear, or do we have to sort of read between the lines with you where are we right now, my friend >> we're not in an all clear and i will come out when there's an all clear just like i came out warning. look, i understand this temptation, this desire to call the all clear. look, in just over a month we went from a record high for the dow on february 12th to the fastest correction in history to the best week last week since 1938 we've been living in fast forward. now we want to fast forward to a much better destination. as you heard from scott gottleib, there was a lot of uncertainty. i think, joe, liquidity. this is a valuable week positioning for people we are balancing from end of quarter, stay on massive they are giving us all an taunt at this to reposition for what is going to be a volatile outlook outlook. >> the reason i ask is how much further to retest the lows that would be a significant selloff because we'd give back all last week and how much further below the lows are warranted g

, more about the worldwide economic response about the coronavirus and whether it will be enough, allianzc advisor, mohamed el erian. any change, mohamed, in how you're feeling since yesterday and i know that, you know, we are not perfect here in terms of social distancing and trying to contain this thing, but there are some signs around at least where i am where there's not a whole lot of activity going on do you think we're going to be successful in trying to -- what we're trying to do, what we're doing, minimizing the overall infection rate or at least spreading it out >> good morning. let me just start with the context and relate to what steve just said. it's false precision, guys, and we should stop it. i'm an economist by training, but this notion that we can give precise numbers to the impact of an unprecedented shock, we don't know how long it's going to last we don't know how deep it's going to be, we don't know what the restart itself looks like. the doctors themselves don't know the notion that we can give a precise number is absurd and we should stop doing it we should just sa

we'll watch it at 9:00 allianz chief economic adviser, mohamed el-erian we'll be down today at the openhat brings us back down to the lower end of what you initially talked about at 20% to 30% you said at 30% you would re-evaluate. are you re-evaluating? what are you coming up with? >> i'm coming up with at least 35% fall from the highs. so we have more to come down here even after you reflect what's in futures. but i can tell you one thing, there are very selective opportunities because we are seeing indiscriminate selling. understand that the private sector is front running a lot of this stuff the good news is on the health issue. the private sector is social distancing much faster the bad news is people run on grocery stores and people are not taking -- >> i could see it fall more, but the question is you don't want to be caught out when and if you believe steven mnuchin or others in the administration are going to injekt some kind of massive policy into this >> yes, absolutely but respect the technicals i can't stress that enough remember, when people cannot sell what they want to s